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Bloomberg
The dollar slumped against its major peers after disappointing U.S. economic data last week cut the chance of a September interest-rate increase to about one in three.
A gauge of the greenback retreated after two weeks of gains. Friday’s below-forecast payrolls data, which came on the heels of a surprise manufacturing slowdown, helped lower the prospect of a hike at the Federal Reserve’s Sept. 20-21 meeting to 34 percent in futures markets, from 42 percent at the end of the week before last.
The yen led the advance among its Group-of-10 peers, rallying from a one-month low, as Bank of Japan Governor Haruhiko Kuroda said there was scope for further monetary easing, while declining to specify any new initiatives.
“The market still has no concrete idea of the Fed’s reaction†to U.S. data, said Thu Lan Nguyen, a foreign-exchange strategist at Commerzbank AG in Frankfurt. “There’s still quite a lot of uncertainty — the market doesn’t necessarily want to trade the U.S. dollar stronger now.â€
The yen appreciated 0.5 percent to 103.37 per dollar as of 1:36 p.m. in London, after sliding to 104.32 on Friday, the weakest level since July 29. The euro was little changed at $1.1156. The Bloomberg Dollar Spot Index, which tracks the currency against 10 major peers, fell 0.2 percent after climbing 1.5 percent over the past two weeks.
Euro Lags
The euro trailed most of its G-10 peers, weighed down by the prospect of more easing from the European Central Bank when it sets policy on Thursday.
Currencies of commodity producing nations climbed amid a jump in crude, with Norway’s krone and the New Zealand and Canadian dollars each rising at least 0.3 percent. The pound reached an almost two-month high of $1.3376 after a services index beat analyst estimates.
, the latest in a slew of data suggesting the impact of the Brexit vote isn’t as bad as some had predicted.
Things are going in the opposite direction in the U.S., with Citigroup Inc.’s Economic Surprise Index for the nation falling back toward zero, a level it last touched since early July and which would mean data are falling short of forecasts.