USD mixed in Europe

[Dark Silver]

Associated Press

FRANKFURT, Germany (AP) -- The dollar was mixed in European trading Wednesday, the first of the new year, as markets looked to the release of a key report detailing the health of U.S. manufacturing later in the day.

The 15-nation euro, which expanded to include Malta and Cyprus on Jan. 1, bought $1.4689 in midmorning European trading, slightly above the $1.4682 it bought on Dec. 31 in New York, and well off its all-time high of $1.4967 set on Nov. 23. Most markets were closed Jan. 1, a holiday in the U.S. and across the euro zone.

The British pound fell to $1.9844 from $2.0029 on Monday, while the dollar climbed to 111.56 Japanese yen from 111.54 on Dec. 31.

The dollar has been buffeted by worries over the health of the U.S. economy and three interest rate cuts by the U.S. Federal Reserve, which is trying to reduce borrowing costs to revive the nation's battered housing market. Investors think another rate cut may be on the way and could glean hints about such a move when the Fed releases the minutes from its last meeting.

Lower interest rates can jump-start a country's economy, but may weigh on the currency as traders look to invest in higher-yielding assets.

Later Wednesday, the U.S.-based Institute for Supply Management will release its manufacturing index.

As a follow up...the DOW did drop, as this report was release (as per one of my previous threads)