Dollar Falls on Bright Global Outlook and Grim U.S. Prospects

The U.S. dollar dropped today against some currencies as the gains of the global stocks and the increasing commodity prices brightened the outlook for the global growth, while the prospect for the growth of the U.S. economy remains less optimistic, damping the appeal of the U.S. currency as the safe haven; the euro performed even worse than greenback, though, falling against the dollar.
The Standard & Poor’s 500 Index rose by 1.5 percent, following its decline by 5 percent last week. August delivery for crude oil rose by 2.5 percent to $73.76 a barrel. The global risk sentiment seems to improve, encouraging the investors to leave the dollar in favor of the higher-yielding currencies.
The economic environment in the U.S. remains not very supportive for the nation’s currency. The growth of the non-manufacturing sector slowed as was shown by the ISM Non-Manufacturing PMI, which dropped to 53.8 percent in June from 55.4 in May. Tomorrow’s report about the unemployment claims should has significant impact on the dollar’s outlook. Would it confirm the worst fears?
GBP/USD traded at about 1.5194 as of 16:43 GMT today after it opened at 1.5148. USD/JPY traded near 87.21 down from the opening rate of 87.49. EUR/USD traded at 1.2605 after opening at 1.2624.

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