Home Forex Dollar Slips Against Yen, Pound Weakens Against Dollar on Downbeat Data

Dollar Slips Against Yen, Pound Weakens Against Dollar on Downbeat Data

Exchange rating. Currency sign yen and dollar.

The dollar was weaker against the yen on Wednesday, falling to its lowest level in more than a week, after downbeat data from the U.S. dampened prospects of a rate hike this month.

The pound, meanwhile, was lower against the dollar after disappointing data showed manufacturing production had fallen more than expected in July. Pharmaceutical manufacturing, textiles and metal production declined, but the car industry and a handful of other sectors managed to expand.

According to the Office for National Statistics, manufacturing as whole declined by 0.9%. Pharmaceuticals led the way with the biggest decline. Economists were expecting a decline of 0.4%.

Manufacturing production on an annualized basis was up 0.8% in July, missing projections of a 1.7% rise.

Industrial production was the bright spot in the report, which climbed 2.1% in July. Economists were expecting a 1.9% increase.

The pound fell to 1.3378 against the dollar before settling at 1.3388, 0.36% lower. Sterling was also weaker against the euro, dipping 0.29% to 0.8399.

Against the yen, the dollar slipped 0.45% to 101.5 on Wednesday after hitting a low of 101.2. The yen was supported by news that Bank of Japan policymakers were still divided ahead of their September meeting. The central bank will assess its massive stimulus program at its next meeting, which will take place September 20-21.

The greenback wasn’t helped by downbeat data from the Institute for Supply Management, which reported that its non-manufacturing PMI slipped to 51.4 in August. Labor market conditioners also declined in August after seeing a positive gain in July.

John Williams, San Francisco Fed President, nevertheless stated that the U.S. economy was in “good shape.” Williams argued that the Fed should “get back to a pace of gradual increases, probably sooner rather than later.”

Although the dollar was weaker against the yen, it strengthened against the euro, which was weighed down by disappointing data. A new report showed Germany’s industrial production saw its biggest decline in nearly two years in July.