The dollar firmed against most major currencies on Monday despite softer-than-expected data out of the U.S. housing sector, as markets took up positions betting that the Federal Reserve will tighten policy while its counterparts in Europe and Japan stay loose.

In U.S. trading on Monday, EUR/USD was down 0.35% at 1.3193.

The Federal Reserve Bank of Kansas City's annual Jackson Hole symposium wrapped up leaving investors preparing for diverging monetary policies across the globe.

While Fed Chair Janet Yellen left investors concluding that stimulus programs will end around October while interest rates will rise some time in 2015, her counterparts in Europe and Japan were seen sticking with more expansionary policies going forward.

Loose U.S. monetary policies such as three rounds of asset purchases, rock-bottom interest rates and dovish language have weakened the greenback since the 2008 financial crisis by keeping borrowing costs low, which sends investors to stocks or gold over the dollar.

Elsewhere, the U.S. Commerce Department reported earlier that U.S. new home sales dropped by 2.4% to 412,000 units last month, confounding expectations for an increase of 5.7% to 430,000.

New home sales in June were revised up to 422,000 units from a previously reported 406,000 units.

Markets shrugged off the report, as last week data revealed that U.S. existing home sales increased 2.4% to 5.15 million units last month from 5.03 million in June. Analysts had expected existing home sales to dip 0.4% to 5.02 million units in July.

Meanwhile in Europe, the Ifo research institute said its German Business Climate Index fell to a more than one-year low of 106.3 this month, missing forecasts for 107.0 and down from 108.0 in July.

The weak data dampened optimism over the health of the euro zone’s largest economy.

The dollar was up against the yen, with USD/JPY up 0.01% at 103.97, and up against the Swiss franc, with USD/CHF up 0.16% at 0.9152.

The greenback was down against the pound, with GBP/USD up 0.06% at 1.6580.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.34% at 1.0982, AUD/USD down 0.21% at 0.9296 and NZD/USD down 0.67% at 0.8346.

The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.25% at 82.59.

On Tuesday, expect markets to move on U.S. durable goods and consumer-confidence data.

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