Dollar Retreats as Data Doesn’t Support Fed Hike Outlook

The US dollar dropped against other major currencies today following yesterday’s economic data. Today’s US economic data, including the GDP report, played its part in the currency’s decline.
Gross domestic product rose 1.5 percent in the third quarter of 2015. The increase was a bit smaller than 1.6 percent predicted by analysts and far below the previous quarter’s growth of 3.9 percent. On top of that, pending home sales dropped 2.3 percent in September after falling 1.4 percent in August. The only positive news came from initial jobless claims that were almost unchanged at 260,000 last week while experts had predicted a small increase.
Yesterday, the dollar rallied as the Federal Reserve suggested that a December interest rate hike is still possible. Yet the Fed also said that its decision relies on economic data. And reports released during the current trading session do not support the case for early monetary tightening.
EUR/USD rallied from 1.0927 to 1.0966 as of 16:30 GMT today. GBP/USD gained from 1.5265 to 1.5297. USD/CHF ticked down from 0.9938 to 0.9918.

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