Dollar continues to decline
Weakening greenback manages an intraday recovery as stocks seesaw on the release of corporate earnings.
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NEW YORK (CNNMoney.com) -- The dollar continued its decline against rival currencies Tuesday, but managed to swing an intraday recovery as stocks seesawed.
The dollar fell against the euro to $1.4853, and also slipped against the yen and the pound to ¥89.6900 and $1.5921, respectively.
The dollar will continue to remain under pressure because the Federal Reserve has kept interest rates near zero and "will be the last central bank to remove its easy monetary policy," said Kathy Lien, director of currency research at Global Forex Trading.
"Unless traders have a reason to stop selling dollars, they won't," said Lien. "The earnings we have seen so far have been relatively healthy and that's reinforces risk appetites in other markets, which is dollar negative."
Dow component Alcoa (AA, Fortune 500) reported revenue and earnings that topped estimates last week. On Tuesday, Johnson & Johnson (JNJ, Fortune 500) reported higher-than-expected earnings, but the drug and medical products maker's third quarter revenue missed expectations, signaling a shaky day for equities.
Though the dollar will continue to weaken under the Fed's current interest rate policy, Lien said it could take a brief break from the decline this week.
"No move can happen in a currency without a relief rally in the process," she said, adding that recovery could pick up if retail sales data released Wednesday is positive.
August retail sales were healthy because of auto sales from the Cash for Clunkers program, but economists predict retail sales to drop 2.1% in September, according to a consensus survey from Briefing.com. Though Lien says overall sales will drop because of the lack of auto sales, core numbers from the report could see an uptick from back to school sales.
Positive retail sales data indicates strong consumer spending, which is key to the sustainability of the mood in the dollar, Lien said. 
