Investing.com – The dollar slumped against a basket of global currencies on Friday amid a drop in investor expectations of a third rate hike later this year, after Federal Reserve chair Janet Yellen avoided talking about monetary policy in a speech at Jackson Hole.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.63% to 92.64.
Fed chair Janet Yellen offered no insight into the central bank’s thinking on future monetary policy or the timing of its balance sheet unwinding, sparking uncertainty as to whether the central bank will raise rates for a third time later this year.
Yellen’s speech came a few hours after data showed durable goods orders in July undershot economists’ expectations.
Overall orders for durable goods, items ranging from toasters to aircraft meant to last three years or more, fell 6.8% in July, the Commerce Department said on Friday, missing expectations of just a 6% decline.
The decline in the greenback fueled sharp moves higher in both sterling and the euro.
EUR/USD rose 0.68% to $1.1880 while EUR/GBP rose 0.05% to 0.9223, ahead of speech by European Central Bank president Mario Draghi at Jackson Hall at 3pm EDT.
Draghi is expected to remain tightlipped on future monetary policy amid concerns from the European Central bank about the sharp rise in the euro in recent months.
GBP/USD recouped some of its recent losses, rising 0.66% to $1.2885.
USD/JPY fell 0.34% Y109.20 while USD/CAD dipped by 0.38% to C$1.2474.