Investing.com - The dollar slid lower against a basket of the other major currencies on Monday amid lingering investor doubts over whether the Federal Reserve will raise interest rates again later this year.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 96.91 by 11.00 ET, adding to Friday’s losses when it fell 0.37%.
The dollar has come under pressure in recent sessions as lackluster economic reports raised questions over the Fed’s plans to tighten monetary policy.
The Commerce Department reported Monday that U.S. durable goods orders unexpectedly fell by 1.1% in May after declining 0.9% in April, pointing to a loss of momentum in the manufacturing sector.
The Fed raised interest rates for the second time this year in June and stuck to its projection for one more rate hike this year despite the subdued inflation outlook, but investors think the pace of its tightening will be much slower than policymakers want.
Futures traders are pricing in less than a 15% chance of a hike at the Fed's September meeting, according to Investing.com’s Fed Rate Monitor Tool. Odds of a December increase are seen at about 35%.
Earlier Monday, San Francisco Fed President John Williams said the Fed needs to raise rates gradually or the economy runs the risk of overheating.
Investors were looking ahead to a speech by Fed Chair Janet Yellen on Tuesday for fresh indications on the path of interest rates and the Fed’s plans to trim its balance sheet.
Meanwhile, European Central Bank Mario Draghi was to speak later Monday and his remarks would be watched for signs that the bank is moving towards a reduction of its stimulus program.
The dollar was a touch higher against the yen, with USD/JPY at 111.39.
The euro rose to one-week highs, with EUR/USD last trading at 1.1202.
Sterling also touched one week highs after British Prime Minister Theresa May secured an agreement with Northern Ireland’s DUP party.
GBP/USD touched highs of 1.2759 and was last at 1.2736.