Early trade in New York: Euro gains on sentiment data

The US dollar weakened against the euro on Tuesday on a better than expected survey of German sentiment and was steady against the Japanese yen after Japanese Prime Minister Shinzo Abe said he would call an early election to seek a fresh mandate for his economic policies. German analyst and investor sentiment rose in November for the first time in almost a year, surpassing expectations and raising hopes of an improvement in Europe's biggest economy after it dodged recession in the third quarter.
The data lifted the euro as high as $1.2540. It last traded at $1.2520. The euro temporarily pared some gains after data showed that US producer prices unexpectedly rose in October. The yen neared a seven-year low against the dollar at 117.03 yen earlier on Tuesday before some investors unwound positions, leaving the Japanese currency largely stable against the greenback. The dollar last traded at 116.56 yen. Some traders say the US dollar rally may need new impetus to continue its bull run.