The U.S. currency fell against 13 of its 16 major counterparts "dollar weakened"

The dollar weakened before the forecast data to show the U.S. economy is gaining momentum, fueling investor demand for higher yielding assets.

The U.S. currency fell against 13 of its 16 major counterparts before reports expected to show U.S. GDP grew faster than estimated and the increase in home sales. The euro rose that German import prices in November rose the most in a decade. The pound fell after the British economy grew at a slower pace than previously estimated, while the Swiss franc strengthened to a record against the common currency for a sixth day.

"Home sales are the weakest element of the entire U.S. history and we are looking for a bounce back in sales of existing homes," said Jeremy Stretch, executive director of foreign exchange strategy at Canadian Imperial Bank of Commerce in London. "If we get a positive number or something in line with expectations, then that would be helpful for risk appetite and probably would be favorable for the euro-dollar and the increased risk for other crossings."

The dollar weakened 0.4 percent to $ 1.3147 per euro from $ 1.3100 at 7:12 am in New York. Was 0.2 percent at 83.56 yen from 83.75.

U.S. home sales increased at an annual rate of 4.75 million in November, up 7.1 percent from October. The U.S. economy grew at a rate of 2.8 percent per year in the third quarter, according to the median estimate of economists polled before a Commerce Department report.

German imports

The euro rose after the import prices in Germany, Europe's largest economy, rose 10 percent in November from a year earlier, the highest in 10 years, after increasing 9.2 percent in October, the Office Federal Statistics said today. Retail sales in Italy rose 0.3 percent in October from the previous month.

The euro rebounded from near a three-week low against the dollar as the stochastic oscillator chart of 14 days was reduced to about 16, below the threshold of 20 that signals of an asset is ready to change direction.

The single currency also strengthened after stop losses triggered call near the level of $ 1.3115 to $ 1.3120, said Charles Han, director of Hong Kong's foreign exchange trading in financial Newedge HK Ltd.

"We have seen some buying in the euro and some stops were triggered, which also caused it to move a little higher," said Han. "There are probably many more risks out of Europe so it prefers to sell into any rallies towards $ 1.3160 area."

Lower concerns

A stop loss is an automatic instruction to buy or sell a currency at a certain level to limit losses if you bet the wrong way.

The euro has fallen 1.8 percent against the dollar since hitting a three-week $ 1.3499 on 14 December. Today it reached a record low against the Swiss franc to 1.2495 amid concerns of further credit downgrades in Europe.

Portugal bond rating may be downgraded one or two levels by Moody's Investors Service after the company warned yesterday of the concern that budget cuts will worsen the country's "slow" growth. Greece may have its credit rating cut to non-investment grade by Fitch Ratings within six weeks.

The pound fell against the euro after a report showed Britain's economy grew at a slower rate than estimated in the third quarter.

Split bench

Data from the National Statistics Office showed gross domestic product in the UK rose 0.7 percent in the third quarter. That compares with an initial estimate of 0.8 percent. Second quarter growth was revised to 1.1 percent from 1.2 percent.

Bank of England Minutes of December meeting showed policymakers remained divided in its decision to keep the benchmark interest rate at a record low of 0.5 percent and the asset purchase program unchanged at 200 million pounds .

The pound sterling depreciated by 0.4 percent to 85.02 pence per euro. Was little changed at $ 1.5461 from $ 1.5470 yesterday.

New Zealand dollar fell against 12 of its 16 most-traded counterparts. A government report tomorrow will show gross domestic product grew 0.1 percent in the third quarter from 0.2 percent in the previous three months.

"I am relatively bearish on the kiwi," said Masashi Murata, vice president of foreign exchange in Tokyo at BBH Investment Services Inc., a subsidiary of New York, Brown Brothers Harriman & Co. The outlook for domestic consumption and interest rates rise have declined, he said.

New Zealand dollar was little changed at 74.41 U.S. cents.