Dollar gains as China manufacturing July PMI to set tone
The dollar gained slightly ahead of a busy Monday start to the data week with industrial production out of Japan and the China Federation of Logistics & Purchasing (CFLP) PMI and services PMI measures among others.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted down 0.61% to 93.20.
Ahead the CFLP manufacturing PMI is expected to show a level of 51.6, a dip from 51.7 in June with a reading of 54.9 for the services PMI in the earlier month. The private Caixinmanufacturing reading is due on Tuesday with a reading of 50.4 seen. Any level above 50 denotes expansion.
Earlier, Japan reports industrial production data with June expected to show a provisional 1.7% gain.
Later, Australia reports private sector credit with a gain of 0.4% seen in June.
Last week, the dollar was broadly weaker against a basket of the other major currencies on Friday after data showing that U.S. economic rowth accelerated in the second quarter, but wage growth remained sluggish.
The Commerce Department said Friday that gross domestic product increased at an annual rate of 2.6% in the three months to June, which included a boost from consumer spending. That was more than double the 1.2% growth seen in the first quarter.
But separate reports showed that wage growth and inflation remained subdued in the second quarter.
The Labor Department said wages and salaries increased 0.5% after accelerating 0.8% in the first quarter.
The Fed's preferred inflation gauge, the personal consumption expenditures (PCE) price index excluding food and energy, increased at a 0.9% rate, the slowest increase in over two years.
The subdued inflation outlook has raised doubts over whether the Federal Reserve will be able to stick to plans for a third interest rate hike this year.
The Fed left rates on hold on Wednesday and said it expected to start shrinking its balance sheet "relatively soon."
Declining expectations for fiscal stimulus under the Trump administration have also fed into recent dollar weakness.
Central bank meetings in the UK and Australia will also be in focus