US Dollar edges lower as Fed’s rate decision eyed

The dollar slid lower on Friday as investors evaluated how high the Fed is likely to raise interest rates by when it meets later in July. Investors also took profits after a strong USD’s rally that sent the American currency to a two-decade high.

The dollar has jumped as the Fed is expected to raise rates faster and further than peer central banks as inflation soars to four-decade highs. The dollar briefly gained on Friday after data showed that US retail sales increased more than expected in June.

Other data showed that manufacturing production slumped for a second straight month in June and US consumers tempered their inflation expectations in July.

The dollar index fell to 108.04, down 0.47% on the day. It reached 109.29 on Thursday, the highest since September 2002. Meanwhile, the Euro gained 0.57% to $1.0080. It traded as low as $0.9952 on Thursday, the weakest since December 2002.