Dollar Over 2-Year Low Against Rivals

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The dollar stayed at 32-month lows against other majors on Friday, as concerns over the potential impact of Hurricane Irma on the Florida coast and tensions with North Korea kept weighing on the greenback.

The greenback continued to hover at 32-month lows against other majors as the European Central Bank’s latest policy statement lent broad support to the euro, while downbeat U.S. data still dampened optimism over the strength of the economy.

EUR/USD was up 0.15% at 1.2040, the highest since January 2015. The safe-haven yen and Swiss franc were stronger, with USD/JPY down 0.67% in a 10-month low of 107.72, and with USD/CHF shedding 0.48% to 0.9461.

Elsewhere, GBP/USD was up 0.71% at a five-week high of 1.3204 after data showed that UK manufacturing production rose more than forecast in July, while industrial production increased as expected.

The Australian and New Zealand dollars were higher, with AUD/USD up 0.52% at 0.8090 and with the NZD/USD rallying 0.77% to 0.7290. Meanwhile, USD/CAD  held steady at a 28-month low of 1.2109.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.33% at 91.19 by 09:15 a.m. ET, the lowest level since January 2015.

Weighing On The Greenback

The single currency rallied after the European Central Bank left interest rates unchanged as expected on Thursday and signaled that information on the tapering of the central bank’s asset-purchase program would be delivered in October.

Meanwhile, sentiment on the greenback remained vulnerable as markets monitored the advancement of Hurricane Irma.  The latest hurricane intensified into an extremely dangerous Category 5 hurricane on the Saffir-Simpson wind scale and is projected to hit Florida over the weekend.

Market participants seemed to shrug off remarks by New York Federal Reserve President William Dudley on Thursday calling on the U.S. central bank to continue gradually raising interest rates, as low inflation should rebound.

Investors were also vigilant amid speculation North Korea could launch an intercontinental ballistic missile on Saturday, which will mark the anniversary of the nation’s foundation.

U.S. President Donald Trump said on Thursday that he would prefer not to use military action against Pyongyang to counter its nuclear and missile threat, but that if he did it would be a “very sad day” for the North-Korean leadership.

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