Investing.com - The U.S. dollar retreated against a basket of major currencies on Friday, as investors awaited clues concerning future monetary policy ahead of a speech from Federal Reserve Chair Janet Yellen.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, slumped 0.22% to 101.94, after hitting a seven-week high of 102.26 on Thursday.
Both Janet Yellen and Fed Vice Chair Stanley Fischer are expected to offer hints on future monetary policy, after several Federal Reserve officials recently indicated that tighter monetary policy may be coming soon.
Expectations of a March rate hike soared on Friday, according to investing.com’s Fed rate monitor tool, nearly 80% of traders expect a rate hike in March, compared to just over 30% on Tuesday.
Meanwhile, U.S. economic data continued to pour in on Friday, as services PMI missed expectations while the ISM non-manufacturing index revealed a 57.6 reading for February.
Economists expected a services PMI print of 53.9.
Elsewhere, GBP/USD declined 0.15% to $1.2247, after UK services PMI for February was reported at 53.3, which was lower than the forecasted 54.1.
EUR/USD gained 0.43% to trade at $1.0551 while EUR/GBP rose 0.58% to 0.8617. The single currency has benefited from recent polls, which showed French far-right candidate Marine Le Pen’s chances of winning country’s presidential election were diminishing.
Meanwhile, USD/CAD added to prior session gains and advanced 0.17% to $1.3415.
The dollar traded firmer against the yen with USD/JPY up 0.17% to 114.61.