Forex - Dollar broadly higher as traders eye Fed minutes

The U.S. dollar traded higher against most of its major rivals during Tuesday’s Asian session, bouncing back after trading lower in Europe and the U.S. during Monday trade. 

In Asian trading Monday, EUR/USD fell 0.15% to 1.2852 European Central Bank President Mario Draghi said in comments before the European Parliament's Economic and Monetary Affairs committee that euro area economic activity should recover over the course of this year. 

Weakness in the euro could be a sign that traders are expecting some form of monetary easing from the ECB later this year. With Draghi pledging to keep interest rates low and expectations in place that the Federal Reserve will begin tapering its USD85 billion-per-month stimulus program, upside for the euro against the greenback could be limited in the near-term. 

USD/JPY inched up 0.04% to 101.04 after the Bank of Japan said that Japan’s M2 money supply rose by a seasonally adjusted 3.8% in June following a 3.5% increase in May. May’s figure was revised up from a 3.4% increase. Analysts expected a June increase of 3.4%. 

GBP/USD dropped 0.18% to 1.4927 after rebounding from near four-month lows on Monday. In a report, Capital Economics said the U.K. economy could be in store for a period of "catch up" growth. In another report, BDO said U.K. business confidence and output both jumped to 13-month highs in June. 

Later Tuesday, the U.K. delivers May industrial output data with analysts expecting an increase of 0.2% following a 0.1% rise in April. 

USD/CHF rose 0.16% to 0.9653 while USD/CAD added 0.09% to 1.0571 as oil prices drifted lower. Investors kept an eye out towards the release of the minutes from the Federal Reserve's June meeting on Wednesday, hoping to gain further insight on the direction of U.S. monetary policy. 

The Australian dollar remains under siege against the greenback asAUD/USD fell 0.25% to 0.9112. NZD/USD dropped 0.20% to 0.7786 while the U.S. Dollar Index rose 0.13% to 84.55.