The US dollar was broadly lower against its major peers today, though the losses were very limited. The currency fell after the release of a GDP report, even though it was very good, showing that the US economy was growing with the fastest pace in four years.
The Bureau of Economic Analysis reported that US gross domestic product rose 4.1% in the second quarter of this year — a sharp acceleration from the 2.2% rate of growth registered in the first quarter. Yet the reading failed to impress the market. Some analysts argued that happened because the report missed expectations, even though the miss was very narrow. Others provided different reasons, like skepticism about sustainability of such fast growth or concerns about the brewing trade war between the United States and China. And yet others speculated that the dollar weakness was just a result of the old “sell the fact” approach.
Whatever the reason was, many market analysts believed that the sell-off of the US currency should be short-lived. The impressive growth should be beneficial to the greenback in the long term, especially as it encourages the Federal Reserve to be bolder with monetary tightening.
EUR/USD traded at 1.1658 as of 18:09 GMT today after opening at 1.1642 and falling to the daily low of 1.1620. GBP/USD was at 1.3116, close to the opening level of 1.3105. USD/JPY slid from 111.22 to 110.95, touching the low of 110.80 intraday.
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