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Dollar Drifts Lower Against Major Counterparts

The U.S. dollar shed ground against its major rivals on Monday amid rising expectations that the Federal Reserve will likely slowdown the pace of its interest rate hikes in the coming months.

Hopes about the central bank turning less aggressive with its policy stance have risen due to recent weak economic data.

In economic releases today, the S&P Global US Manufacturing PMI was revised slightly lower to 52.2 in July of 2022 from a preliminary of 52.3, pointing to the lowest factory growth since July of 2020.

The Institute for Supply Management said the ISM Manufacturing PMI edged lower to 52.8 in July of 2022 from 53 in June, beating market forecasts for a reading of 52. The reading pointed to a 26th straight month of rising factory activity but the weakest rate since June of 2020.

The ISM Manufacturing Employment sub index in the United States increased to 49.90 points in July from 47.30 points in June, compared with expectations for a reading 47.4.

The ISM Manufacturing New Orders sub index in the United States decreased to 48 points in July from 49.20 points in June of 2022.

Data from the Commerce Department showed construction spending in the US fell by 1.1 percent from the previous month to a seasonally adjusted annual rate of $1.76 trillion in June, compared to the revised 0.1 percent increase in May and market expectations of a 0.1 percent rise.

The dollar index dropped to 105.24 in the New York session and despite recovering to 105.41, remained in negative territory, netting a loss of nearly 0.5 percent.

Against the Euro, the dollar is trading at $1.0258, weakening from Friday's close of $1.0227.

The dollar is trading at $1.2253 against Pound Sterling, easing from $1.2180.

Against the Japanese currency, the dollar has weakened to 131.63 yen from 133.24 yen.

The dollar is trading at 0.7027 against the Aussie, dropping from 0.6991.

Against Swiss franc, the dollar is weak, fetching CHF 0.9501 a unit, down from CHF 0.9516.

The Loonie has weakened to C$1.2839 a dollar, drifting lower from C$1.2796, weighed down by falling crude oil prices.

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