The greenback continued to weaken against most major currencies amid expectations that Federal Reserve (Fed) Chairman Jerome Powell will continue to stick with current monetary policy easing at a policy meeting this week.
After seeing strong growth in economic data recorded last week, investors are now wondering whether the rising job and vaccination markets will necessitate a tightening of monetary policy by the Fed.
However, Powell is expected to continue to reiterate the central bank’s commitment to stay abreast of current monetary policy and said talks on it are still too early.
On Friday, the market was weighed down with US manufacturing and services PMI readings showing encouraging gains in April. The US dollar initially welcomed this reading, before returning lower during the New York session.
In the Asian session, the dollar index, which measures the strength of the greenback against a group of major currencies, plunged lower and traded around 90.70.
The weakness of the US dollar has pushed the euro to a two -month high, supported by stronger readings of manufacturing and services PMI data in April.
The release of German business sentiment data, which is forecast to be positive today, is expected to further boost market expectations for a brighter European economic outlook.
