Dollar edges lower as oil price gain boosts commodity currencies

The dollar eased against a basket of currencies and fell against the euro on Wednesday in thin holiday trading, while a rally in commodity prices helped push the Canadian and Australian dollars to their highest levels in two months.

Traders said there was little news to support the euro's rise, but some investors have positioned for a possible strengthening in the single currency into the new year following a stellar 2017 in which the euro had its best year against the greenback since 2003.

Sterling markets were quiet, with the pound up 0.1 percent at $1.338.

Oil prices had surged to 2-1/2 year highs on Tuesday, boosted by news of an explosion on a Libyan crude pipeline as well as voluntary OPEC-led supply cuts. Copper prices on Wednesday rocketed to their highest in three and a half years.

That helped support demand for the currencies of commodity exporting countries, with the Canadian dollar touching C$1.2659 , its highest level since October.

Similarly, the Australian dollar rose 0.4 percent to $0.7762, reaching its highest level in two months.

The U.S. dollar eased 0.1 percent against a basket of major currencies to 93.193. (DXY)

The U.S. dollar was also down 0.1 percent versus the euro at $1.187