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Dollar Stays Firm Against Major Currencies

The U.S. dollar is holding firm against most major currencies on Tuesday, with traders looking ahead to President Donald Trump's State of the Union address tonight.

Trump is expected to call on Congress to come together on infrastructure projects and his trade deal with Canada and Mexico. Trump's speech is likely to provide clues about what could be in store with regard to the conflict over funding for the border wall. The speech is also likely to provide some updates on U.S.-China trade issues.

Traders are also looking ahead to the Federal Reserve Chair Jerome Powell's speech at a town hall meeting in Washington, scheduled for Wednesday.

Speeches from some key Fed officials, Fed Vice Chair Richard Clarida, Cleveland Fed President Loretta Mester, St. Louis Fed President James Bullard and Fed Governor Randal Quarles are all scheduled to speak at various forums this week. Markets will be looking for clues on future rate decisions from these speeches.

The dollar turned subdued last week after the Federal Reserve left interest rate unchanged and Powell said the "case for raising rates has weakened somewhat."

However on Friday, the greenback firmed up after data showed a higher than expected addition of jobs in the month of January.

The dollar index is currently up by about 0.2%, exhibiting strength against a basket of major currencies.

The dollar has risen to $1.2957 against Pound Sterling, gaining about 0.6%. Against the Euro, the greenback is gaining 0.2%, at 1.1414, after data showed Eurozone service sector activity to have dipped in January.

the IHS Markit data showed growth in eurozone almost stalled in January. The IHI's composite final PMI dipped to 51.0 in the month from December's 51.1, its lowest reading since July 2013.

A measure of Euro zone retail sales also fell as expected in December amid declines in non-food sales and online purchases.

U.K. service sector growth slowed more-than-expected in January, moving closer to stagnation, as new orders decreased for the first time in two-an-a-half years, preliminary data from IHS Markit showed.

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