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Dollar slips lower vs. rivals ahead of U.S. GDP data

7/28/2017, 2:24:49 PMTrading Strategies
Dollar slips lower vs. rivals ahead of U.S. GDP data

The dollar slipped lower against other major counterparts on Friday, as recent comments by the Federal Reserve continued to weigh and as investors awaited the release of second-quarter growth data due later in the day.

EUR/USD edged up 0.15% to 1.1694, not far from Thursday’s two-and-a-half year highs of 1.1777.

The dollar remained under pressure after the Fed said on Wednesday that inflation remains below its 2% target even as near-term risks to the economic outlook appear “roughly balanced.” In the past, the Fed judged that weakness in inflation was transitory.

The central bank’s cautious tone on inflation sparked fresh uncertainty over the possibility of a third rate hike this year.

The Fed also said it expected to start shrinking its balance sheet "relatively soon", prompting expectations for an announcement in September.

The greenback was also weakened by data on Thursday showing that initial jobless claimsrose by 10,000 to 244,000 last week. Analysts expected jobless claims to rise by 7,000 to 241,000 last week.

GBP/USD added 0.17% to trade at 1.3088, pulling away from the previous session’s 10-month peak of 1.3159.

Elsewhere, USD/JPY slid 0.31% to 110.91.

Earlier Friday, data showed that the Tokyo consumer price index rose by an annualized rate of 0.1% last month, in line with expectations.

The Tokyo core CPI, which excludes fresh food, increased by an annualized rate of 0.2% in June, beating expectations for an uptick of 0.1%.

A separate report showed that Japan’s household spending increased by 1.5% in June, confounding expectations for a 0.1% slip.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.15% at 93.64, not far from Thursday’s 13-month low of 93.00.