The dollar drifted higher on Tuesday, trading in narrow ranges, as investors continued to adjust positions ahead of this week’s key decision on bond-buying by the U.S. Federal Reserve.
The U.S. currency ended last week slightly lower against a basket of major currencies and investors are buying back the greenback this week to square up positions, analysts said.
As the Fed begins its two-day policy-meeting on Tuesday, market participants generally expect no major policy changes, though the U.S. central bank could begin to lay the groundwork for a reduction in its economic stimulus that could occur in the first quarter of the year.
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