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Dollar Falls on US Growth Slowdown

July 29, 2011 at 13:13 by Andriy Moraru

US DollarThe US dollar fell sharply against some of the major currencies today, following a report that showed that the economic growth in the second quarter of 2011 was worse than expected.

The greenback was trading at a rather high level against the other currencies earlier today, advancing significantly both against the euro and the Great Britain pound before 12:30 GMT today. Following the US GDP report, it slid to bearish against the euro and trades almost in the negative zone against the pound. The dollar is also down against the Japanese yen and the Swiss franc.

The gross domestic product increased at an annual rate of 1.3 percent in the Q2 2011 from the Q1 2011. The first quarter growth was revised down from 1.9 percent to 0.4 percent. The traders expected 1.8 percent gain in GDP on average. This news is very pessimistic in regards of the possible rate increases in the United States and thus is extremely negative for the US dollar.

EUR/USD went up from 1.4327 to 1.4333 as of 13:09 GMT, trading as low as 1.4229 earlier. GBP/USD is now trading near its opening level — 1.6369. USD/JPY fell from 77.69 to 77.14 today.

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

2 Responses to “Dollar Falls on US Growth Slowdown”

  1. AMIT KUMAR

    hi,
    i trade in forex i have taken a trade in GBP/USD sell at 1.6318. what is u r opinion & advice pertaining to this trade, will the market come down, should i wait, if not then what should i do. pls reply.
    THANK YOU

  2. Andrei Moraru

    GBP/USD may go down if the US authorities manage to lift their debt limit by August 2. Otherwise it may rally.

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