By Omer Esiner of TravelexThe dollar slid against most major currencies early Tuesday, largely on market-positioning ahead of the Federal Reserve's policy announcement due out around 2:15 p.m. EDT. The Federal Open Market Committee, the U.S. central bank's policy-setting team, is widely expected to leave its benchmark interest rate, known as the federal funds rate, unchanged. In its accompanying statement, the FOMC is expected to repeat its vow to leave the federal funds rate unchanged for an "extended period." Investors will study the Fed's statement for its latest assessment of the U.S. economy and to see whether it alters its language on the outlook for monetary policy. A more hawkish tone would support the dollar. The Canadian dollar kept near recent 20-month highs against the greenback. The Canadian dollar has been bolstered in recent sessions by solid domestic data that have indicated a recovery is gaining traction. Modestly firmer oil prices of more than $80 a barrel are also buoying the loonie. The euro was boosted by a smaller-than-expected decline in German investor sentiment in March. Still, Europe's common currency remains vulnerable to selling pressure given Greece's precarious budget situation. USD: U.S. housing starts fell 5.9% month over month in February to an annualized rate of 575,000 units, which was a little better than forecast. Housing starts were adversely impacted by severe winter weather during February. U.S. import prices fell 0.3% month over month in February, which was a touch worse than the forecast for a 0.2% decline. Following these reports, the dollar was little changed near session lows. CAD: The Canadian dollar extended gains against the buck after Canadian manufacturing sales increased by 2.4% month over month in January from an upwardly revised 1.9% in the previous month. Investors had expected a more modest rise of 0.5% in January. The strong report offered fresh evidence of an improving Canadian recovery and bolstered the loonie.