Investing.com - The dollar was trading near one-week lows against the other major currencies on Monday as weak U.S. economic reports tempered expectations for a rate hike from the Federal Reserve this year.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 95.6, not far from Friday’s lows of 95.19.
Data on Monday showed that business activity among New York manufacturers declined in August.
The Empire State manufacturing index fell to -4.2 from July's 0.55 the Federal Reserve Bank of New York said. Analysts had expected the index to improve to 2.5.
The report underlined concerns over the outlook for the economy after weaker than expected reports on U.S. retail sales and producer prices on Friday.
The weak economic reports added to uncertainty over whether the U.S central bank will hike interest rates again before then end of this year.
The U.S. central bank raised interest rates for the first time in almost a decade in December.
Higher interest rates typically boost the dollar by making it more attractive to yield seeking investors.
The euro was slightly higher, with EUR/USD advancing 0.15% to 1.1178.
The dollar was near the lowest levels of the day against the yen, with USD/JPY easing 0.14% to 101.13.
The yen showed little reaction to data Monday showing that Japan’s economic growth stalled in the second quarter.
The pound fell to one-month lows, with GBP/USD down 0.26% to 1.2877 as investors looked ahead to a series of economic reports later in the week which will show the impact of Brexit on the UK economy.
The U.K. was to release data on inflation on Tuesday, which was to be followed by the latest employment report on Wednesday and figures on retail sales on Thursday.
The commodity linked currencies edged higher in quiet trade, with USD/CAD easing 0.14% to 1.2933.
AUD/USD was up 0.18% at 0.7659, while NZD/USD was little changed at 0.7201.