Forexpros – The U.S. dollar moved broadly lower against its major counterparts in U.S. trade Friday, as the Federal Reserve Bank postponed a decision on further monetary easing and gross domestic product was shown to have grown slower than expected in the second quarter.
In afternoon U.S. trade, the greenback was lower against the euro, with EUR/USD gaining 0.74% to hit 1.4486.
After much market anticipation, Federal Reserve Bank Chairman Ben Bernanke addressed mounting speculation that the U.S. central bank would move to trigger growth in a faltering U.S. economy.
Speaking from the central bank’s annual meeting in Jackson Hole, Wyoming, Bernanke said although the Fed had the capacity to stimulate U.S. economic growth, further discussion was necessary to weigh the benefits of an additional round of quantitative easing.
“These options were discussed in August and we will continue to consider these and other pertinent issues at our meeting in September,” Bernanke said.
Separately, the Bureau of Economic Analysis reported that U.S. gross domestic product rose to a seasonally adjusted rate of 1% in the second quarter. That followed a 1.3% rise the previous three-month period but below market expectations of a 1.1% gain for the April to June quarter.
Consumer spending, the largest component of the U.S. economy, rose at an annualized rate of 0.4% in the first quarter, the smallest gain in a year, but up from the initial estimate of a 0.1% gain.
Wall Street shares were on track to post their first weekly gain in a month, with the Dow Jones Industrial Average gaining 1% to 11,254.20, the Nasdaq Composite Index climbed 2% to 2,469.21, and the S&P 500 added 1.1%. to 1,172.56.
Meanwhile, the greenback was down against the British pound, with GBP/USD gaining 0.37% to hit 1.6339.
The dollar was lower against the Japanese yen but up against the Swiss franc with USD/JPY retreating 1.08% to hit 76.69, and USD/CHF sharply higher by 1.79% to hit 0.8074.
The greenback was lower against its Canadian, Australian and New Zealand counterparts with USD/CAD down 0.52% to hit 0.9830, AUD/USD higher by 1.37% to hit 1.0573, and NZD/USD rising 1.46% to hit 0.8391.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.61% at 73.87.
The Federal Reserve’s next Federal Open Market Committee meeting was scheduled for September 20.
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