US Dollar Drops After Disappointing Data

Concerns that the United States might be seeing a slowdown in its economic growth are weighing on the greenback today. Recent economic data has been softer than expected, and that is bringing the dollar lower in Forex trading.

On Friday, a report indicated that economic growth in the United States slowed to 2.6 per cent in the fourth quarter of 2014. This had already set the stage for a slightly lower greenback when yesterday’s manufacturing report was released. The PMI index fell to 53.5 in February, which represents a drop from the January reading of 55.1. Analysts had expected PMI to weaken, but they thought the decline would be to 54.3. This bigger decline has some worried about the US economy.
Some think that maybe the Federal Reserve stopped its bond buying program too early, and that it might be reinstated if more signs of slowing growth appear. This is also providing speculation that the Fed will put of raising interest rates.
At 11:58 GMT the US dollar index is down to 94.4350 from the open at 94.5490. EUR/USD is higher, moving up to 1.1340 from the open at 1.1335. GBP/USD is gaining as well, moving up to 1.5054 from the open at 1.5022. USD/JPY is lower, dropping to 117.4300 from the open at 117.4820.

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