Investing.com - The dollar weakened against the other major currencies on Monday as expectations for a short term rate hike by the Federal Reserve diminished, while the yen gained following comments by Bank of Japan Governor Hiruhiko Kuroda.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, slid 0.25% to 95.17.
The index ended the previous week down 0.75% after the Fed hinted at one interest rate increase this year, but projected a less aggressive increase in rates next year and in 2018.
Expectations of higher interest rates typically boost the dollar by making it more attractive to yield seeking investors.
USD/JPY fell 0.49% to 100.48 after the BoJ head reiterated a commitment to do everything necessary to hit its inflation target, including cutting interest rates further into negative territory.
The BoJ rebooted its monetary policy framework last week, but investors remain skeptical over whether it will be enough to spur inflation.
The euro pushed higher, with EUR/USD rising 0.28% to 1.1257.
The single currency was boosted after upbeat data on German business sentiment.
Sterling slipped lower, with GBP/USD down 0.21% to 1.2927.
The Canadian dollar was steady at 1.3174 despite a rebound in oil prices.
Traders were looking ahead to the first U.S. presidential debate later Monday, which could have the potential to move the dollar.