The US dollar dropped today as most of economic reports that came out from the United States were rather poor, making market participants question if the US economy is ready for monetary tightening from the Federal Reserve or policy makers will wait before starting interest rate hikes.
Unemployment claims increased from 313,000 to 317,000 last week from the week before even though experts promised them to fall to 306,000. Retail sales grew 0.3 percent, below market expectations of 0.3 percent. Other reports were also not particularly good.
The poor indicators made it less likely for the Fed to start tightening this year. Such outlook is detrimental for the dollar especially considering that hope for higher interest rates is already priced in.
EUR/USD advanced from 1.3531 to 1.3560, and GBP/USD rose from 1.6787 to 1.6884 as of 20:05 GMT today. USD/JPY dropped from 102.07 to 101.61.
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