The dollar traded 0.1 percent from a one-month low versus the euro as weaker U.S. economic indicators bolstered the argument for the Federal Reserve to delay a reduction to its bond-buying program.
The greenback remained lower after a two-day decline versus the yen ahead of a report today forecast to show new home sales in the U.S. rose at a slower pace in June. The euro was supported before data predicted to show services and factory output in the 17-nation region contracted at the slowest pace in more than a year. The Aussie dollar snapped a three-day gain ahead of a government report that economists forecast will show inflation remains contained.
“The market was looking at a September start to tapering as a done deal, but now the idea that might not happen is starting to emerge, and traders are paring bullish dollar positions,” said Yoshitsugu Fujita, an assistant vice president of global markets at Sumitomo Mitsui Trust Bank Ltd. in New York. “I think dollar weakness could last until the U.S. growth data next week,” he said, referring to a second-quarter gross domestic product report due July 31.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.