* March U.S. existing home sales dip less than expected
* ECB's Draghi speech may weigh on euro
* Euro zone PMIs and German IFO a key focus
(Updates with late New York prices)
By Daniel Bases
NEW YORK, April 22 Investors trimmed U.S.
dollars positions on Tuesday after a two-week run higher,
unmoved by a U.S. March existing home sales report that beat
expectations but still showed a modest decline to a 1-1/2 year
Trading ranges remained narrow as Europe returned from the
Easter holidays and faced uncertainty over whether European
Central Bank policy will move toward more monetary stimulus.
The euro gave up some of its modest gains, but remained
positive against the greenback and yen.
U.S. existing home sales slipped by 0.2 percent in March
compared to February, but annual unit sales, while the lowest
since July 2012, beat forecasts.
European Central Bank President Mario Draghi recently made
clear the euro's strength is a possible trigger for the central
bank to ease monetary policy. He is scheduled to give a speech
in Amsterdam on Thursday.
ECB executive board member Benoit Coeure said on Tuesday
there was further margin to reduce the main interest rate below
0.25 percent and that the strength of the euro could be keeping
inflation too low.
But until the ECB takes action, possibly at its next meeting
on May 8 in Brussels, traders said the euro would stay
The euro slipped to a two-week low of $1.3783, a
slight loss on the session before rebounding to trade slightly
higher at $1.3804.
"For all the talk of unorthodox measures, the euro has been
rock solid. It may be constraining the upside, but it is not
beating it down either. The euro bears are long exhausted here,"
said Alan Ruskin, global head of G10 FX strategy at Deutsche
Investors await Wednesday's euro zone 'flash' PMI surveys
while the German IFO institute's monthly reading of business
sentiment in Europe's largest economy is due
"Euro/dollar is likely to trade with a weaker bias this week
given the German IFO and Draghi's speech coming up," said Yujiro
Goto, currency analyst at Nomura. "Any downside will be limited
though, as investors will await the inflation data due next
Very weak inflation in the euro zone, due partly to the
strong exchange rate, raises pressure on the ECB to further
loosen monetary policy to stimulate growth.
In recent weeks Draghi has brought the currency into focus
and warned any further strengthening could lead the euro zone's
central bank to use unconventional tools such as asset
On the other hand, analysts said the dollar was starting to
look attractive on the back of improving U.S. data and earnings.
"Better-than-expected company earnings could also encourage
renewed inflows into the U.S. stock markets and underpin the
dollar," said Citi analyst Valentin Marinov.
The dollar was unchanged at 102.61 yen, after hitting
its best level since April 8 of 102.73 yen.
(Additional reporting by Anirban Nag in London; Editing by Mark
Trevelyan, Tom Brown and Chris Reese)