Dollar falls against major currencies
Weak economic data weighs on greenback while the markets remain in holiday mode.
NEW YORK (CNNMoney.com) -- The dollar fell against major currencies Tuesday after reports showed huge declines in new home sales and weak consumer confidence.
A report showed that new home sales plunged 18% in October, a record decline that marks the 27th month of falling prices.
And consumer confidence plunged to an all-time low this month, as the recession and credit crisis took its toll on sentiment.
The currency markets are being driven mainly by technical data, as opposed to fundamentals, due to the light volume of trades during the holiday period, said Gareth Sylvester, currency strategist at foreign exchange brokerage HiFX.
The relatively light volume of trades means the market will remain choppy into the new year, he added.
The dollar weakened against the 15-nation euro, as it gained nearly one and a half cents, to $1.4073 from $1.3927 late Monday.
The euro approached parity with sterling Tuesday, surging to .976 British pounds as the currency nears 10 years since its launch in 1999.
The greenback fell against the British pound, which rose to $1.4424 from $1.4413 late Monday.
The dollar also slipped against the Japanese yen, to ¥90.27 from ¥90.65 late Monday.
Despite the dollar's losses, Sylvester expects the greenback to recover in the new year.
"Until the market shows signs of encouragement, investors will be risk averse, and so the U.S. currency should remain the dominant currency into the first quarter," he said.
Markets: Stocks rallied Tuesday as investors welcomed the government's investment of $6 billion into GMAC Financial Services, the financing arm of struggling automaker General Motors.
Oil: U.S. light crude oil for February delivery fell 99 cents to settle at $39.03 a barrel on the New York Mercantile Exchange, after gaining 13% over the previous two sessions. 
