Dollar Weakens as Expectations for Fed Rate Hike Fade

The US dollar index fell on Monday as expectations of a Federal Reserve interest rate hike this year faded. The yen was stronger against the dollar, gaining 0.2% to 159.075 yen, while Japan's GDP for the second quarter expanded at an annualized 1.1%. This data did little to boost the yen, which is instead largely driven by the fading expectations of a Fed rate hike.

The euro and British pound also gained ground against the dollar, with the euro up 0.1% at $1.1585 and the British pound 0.1% stronger at $1.3551. The Australian dollar was 0.3% higher at $0.7101 and the kiwi advanced 0.4% to $0.5911, both reaching their strongest levels since June.

The US dollar index traded near its lowest levels of the month at 99.501, down 0.1%. Against the Chinese yuan, the dollar was flat at 6.7412 yuan in offshore trade ahead of activity data due for release later on Monday.