Dollar up vs. euro and pound

NEW YORK (CNNMoney.com) -- The dollar rose against other major currencies Tuesday, except the yen, as global economic jitters boosted demand for safe-haven currencies even as U.S. stocks rebounded.

What prices are doing: The dollar rose 0.5% versus the euro to $1.4076 and gained 0.6% against the U.K. pound to $1.6145. But the dollar fell 0.7% against the yen to ¥89.64.

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Click the chart for current FX rates.

What's moving the market: Traders continued to flock to the dollar for safety as a late-session financial selloff erased gains in equities. Lower bank shares hurt stocks, which had been higher earlier in the session on a stronger-than-expected consumer confidence report.

The Consumer Confidence index, from the Conference Board, rose to 55.9 in January from 53.6 in the previous month, versus forecasts for a reading of 53.5.

"The market continues to be concerned about monetary and credit concerns in China," said Sacha Tihanyi, a currency analyst at Scotia Capital in Toronto.

Traders have been shying away from high-risk currencies, such as the euro, amid signs that the Chinese government has ordered certain banks to curb lending and could move to tighten monetary policy. The moves are reportedly aimed at slowing China's robust economic growth and avoiding asset bubbles in certain markets.

Concerns about the global economy were also fueled by a possible downgrade of Japan's credit rating after Standard & Poor's said it was worried about large deficits and a sluggish growth outlook for what has been the world's No. 2 economy.

The pound came under pressure after the U.K. government said the nation's economy grew at a slightly slower-than-expected pace in the fourth quarter.

U.K. gross domestic product rose 0.1% in the fourth quarter, compared to the third quarter. Compared with a year earlier, GDP fell 3.2%. Economists had expected a quarterly rise of 0.4%, and a full year decline of 2.9%.

"The market was disappointed by that number," said Andy Fox, a foreign exchange trader at Sucden Financial in London. "The U.K. is out of recession, but only just."

The dollar's mixed performance comes as the Federal Reserve opened its two-day policy meeting Tuesday, with a statement due Wednesday afternoon.

The central bankers are widely expected to hold interest rates steady at historic lows near zero and to signal that they will continue to do so for the time being.

But the statement could impact financial markets if it contains any hints about when the Fed will raise interest rates or withdraw some of the trillions of dollars of stimulus it had put into the economy over the last few years.

What analysts are saying: Kathy Lien, director of currency research at trading firm GFT, said the Fed's statement will probably have a more cautious tone given a recent spate of weaker-than-expected economic reports.

"But given the potential impact that a change in tone could have on the financial markets, the risk of triggering further volatility in currencies and equities is far greater than the risk of leaving the [Fed] statement virtually unchanged," she said.