Investing.com - The dollar was broadly lower against the other major currencies on Monday after Larry Summers withdrew from the race to be the next head of the Federal Reserve, while weak U.S. manufacturing data also weighed.
During European afternoon trade, the dollar was down against the yen, with USD/JPY shedding 0.64% to trade at 98.71.
Investor confidence was boosted after Summers’ pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Investors were also awaiting the outcome of the upcoming Fed policy meeting, which concludes on Wednesday.
Data released on Monday showed that the Empire State manufacturing index fell to a four-month low of 6.29 in September from a reading of 8.24 in August. Analysts had expected the index to rise to 9.2.
The soft data added to doubts over whether the Fed will decide to start unwinding its USD85 billion-a-month bond buying program this month.
Elsewhere, the euro was close to three-week highs against the dollar, with EUR/USD advancing 0.60% to 1.3375.
European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”. The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.
The pound advanced to eight-month highs against the dollar, with GBP/USD climbing 0.46% to 1.5950.
The dollar was also lower against the Swiss franc, with USD/CHF falling 0.50% to 0.9271.
Elsewhere, the greenback was sharply lower against its Australian, New Zealand and Canadian counterparts, with AUD/USD jumping 1.50% to 0.9384, NZD/USD rallying 1.07% to 0.8220 and USD/CAD losing 0.55% to trade at 1.0302.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.59% to 81.18.
The U.S. was to release data on industrial production and the capacity utilization rate later in the trading day.
During European afternoon trade, the dollar was down against the yen, with USD/JPY shedding 0.64% to trade at 98.71.
Investor confidence was boosted after Summers’ pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Investors were also awaiting the outcome of the upcoming Fed policy meeting, which concludes on Wednesday.
Data released on Monday showed that the Empire State manufacturing index fell to a four-month low of 6.29 in September from a reading of 8.24 in August. Analysts had expected the index to rise to 9.2.
The soft data added to doubts over whether the Fed will decide to start unwinding its USD85 billion-a-month bond buying program this month.
Elsewhere, the euro was close to three-week highs against the dollar, with EUR/USD advancing 0.60% to 1.3375.
European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”. The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.
The pound advanced to eight-month highs against the dollar, with GBP/USD climbing 0.46% to 1.5950.
The dollar was also lower against the Swiss franc, with USD/CHF falling 0.50% to 0.9271.
Elsewhere, the greenback was sharply lower against its Australian, New Zealand and Canadian counterparts, with AUD/USD jumping 1.50% to 0.9384, NZD/USD rallying 1.07% to 0.8220 and USD/CAD losing 0.55% to trade at 1.0302.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.59% to 81.18.
The U.S. was to release data on industrial production and the capacity utilization rate later in the trading day.