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Forex - U.S. Dollar Slumps as Euro Rebounds After Draghi Comments

Published 25/07/2019, 15:23
© Reuters.
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Investing.com - The U.S. dollar fell on Thursday after durable goods orders in May were revised lower, while the euro was higher after comments from European Central Bank President Mario Draghi pointed to more stimulus measures .

New orders for U.S.-made long-lasting goods surged 2% in June, but a downward revision to a fall of 2.3% in May is unlikely to change sentiment that the economy is slowing down.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, slumped 0.2% to 97.292 by 10:22 AM ET (14:22 GMT).

The dollar rose against the Japanese yen, with USD/JPY up 0.3% to 108.48.

The euro rallied after Draghi signaled that the ECB would ease in September to battle the euro zone’s economic slowdown as the outlook gets “worse and worse,” he said.

“It’s getting worse and worse in manufacturing, especially, and it’s getting worse and worse in those countries where manufacturing is very important. But because of value chains this propagates all over the euro zone. And so this must be taken into account,” Drahi said in Frankfurt.

The ECB kept rates unchanged, but is expected to cut interest rates in September. The decision was announced just after manufacturing data in the euro area showed that the economy is contracting, while business confidence in Germany fell.

EUR/USD gained 0.3% to 1.1170, while GBP/USD was flat at 1.2473.

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