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USD weakens after mixed Fed signals and soft US growth data

The preliminary reading put US Q2 GDP growth at 1.5% year over year, below the 2.1% market expectation, adding to pressure on the dollar.

Reported · Written up by our desk · Central Banks

The US dollar lost ground across FX markets as investors weighed uncertainty around the Federal Reserve’s next move alongside weaker US economic data, FXStreet reported.

In the US, a preliminary estimate showed Q2 GDP grew at an annual rate of 1.5%, which missed expectations for 2.1%. FXStreet said the combination of the data shortfall and broader dollar weakness helped lift GBP/USD above 1.3450, with the pair holding above multi-week highs.

FXStreet also cited renewed dollar weakness driven by factors beyond the growth print, including a divided Fed decision to keep rates on hold and concerns that US Dollar strength could be capped if a September hike becomes less likely.

FXStreet further noted that gold hovered just above $4,100 amid the dollar sell off, while it flagged additional potential pressure on the greenback tied to a suspected JPY intervention.

Latest closeGold $4,166.30 ▲3.3%|GBP/USD 1.347 ▲1.4%

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