US focus: Dollar weakens

The dollar fell as stocks and commodities rose, reducing demand for a refuge as the Federal Reserve begins a two-day policy meeting.
The greenback weakened to the lowest versus the euro in almost a week. The shared currency rose as European leaders said a Greek default can be avoided amid speculation Prime Minister George Papandreou will win a confidence vote today.
The euro rose as Greece’s Papandreou seeks to secure multiparty support for his government’s austerity measures. That is a condition for receiving aid needed to avoid a default.
Greece needs parliamentary approval of a 78 billion-euro ($112 billion) package of budget cuts and asset sales.
The greenback remained weaker as National Association of Realtors data showed sales of existing homes decreased in May to the lowest level in six months.  Purchases of existing U.S. homes fell 3.8% to a 4.81 million annual pace last month, in line with estimates.
Meanwhile, economists forecast the Federal Open Market Committee will keep the benchmark interest rate at zero to 0.25 percent tomorrow, where it’s been since December 2008.
Australia’s dollar declined after the nation’s central bank said domestic data had not added “any urgency” to the need for policy adjustment and it may be “prudent” to keep rates unchanged, according to minutes released today of a June 7 policy meeting.
The pound weakened as Bank of England Markets Director Paul Fisher said further bond purchases to stimulate the economy are possible.