Investing.com - The dollar continued to hover near 13-month lows against the other major currencies on Friday, ahead of the release of U.S. second-quarter growth data and as recent comments by the Federal Reserve on the level of inflation continued to weigh on the greenback.
The dollar remained under pressure after the Fed said on Wednesday that inflation remains below its 2% target even as near-term risks to the economic outlook appear “roughly balanced.” In the past, the Fed judged that weakness in inflation was transitory.
The central bank’s cautious tone on inflation sparked fresh uncertainty over the possibility of a third rate hike this year.
Sentiment on the greenback also remained vulnerable after Senate Republicans failed to pass their Obamacare repeal bill in a dramatic vote of 49-51 late Thursday night.
At least three Republicans, including Sen. John McCain, voted against the bill which needed a simple majority to pass in the Senate. President Donald Trump reacted to the vote by saying the three had "let the American people down".
EUR/USD rose 0.28% to 1.1710, not far from Thursday’s two-and-a-half year highs of 1.1777.
The single currency has been largely supported in recent weeks, after European Central Bank President Mario Draghi signaled in June that it could soon start tapering its stimulus program.
Elsewhere, GBP/USD gained 0.27% to 1.3100.
USD/JPY held steady at 111.28, while USD/CHF climbed 0.72% to trade at 0.9716.
Earlier Friday, data showed that the Tokyo consumer price index rose by an annualized rate of 0.1% last month, in line with expectations.
The Tokyo core CPI, which excludes fresh food, increased by an annualized rate of 0.2% in June, beating expectations for an uptick of 0.1%.
A separate report showed that Japan’s household spending increased by 1.5% in June, confounding expectations for a 0.1% slip.
In Switzerland, data earlier showed that the KOF Economic Barometer rose to 106.8 this month from 105.8 the previous month, beating expectations for an uptick to 106.0.
The Australian and New Zealand dollars were weaker, with AUD/USD down 0.11% at 0.7959 and with NZD/USD shedding 0.27% to 0.7467.
Meanwhile, USD/CAD was almost unchanged at 1.2552.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.22% at 93.56, just off Thursday’s 13-month low of 93.00.