FOREX-Dollar index at 2-mth low on dovish Fed minutes

* Dollar hits 2-mth low vs currency basket, euro

* Dovish Fed minutes increase U.S. growth worries

* Focus on U.S. data, JPMorgan earnings later in the day

By Jessica Mortimer

LONDON, July 15 (BestGrowthStock) – The dollar hit a two-month low
against the euro and a basket of currencies on Thursday after
dovish U.S. Federal Reserve minutes triggered concerns about the
outlook for the U.S. economy.

Federal Reserve officials slightly revised down their
economic growth outlook, while minutes from the central bank’s
June 22-23 meeting said further policy stimulus may need to be
considered if the outlook worsened. [ID:nN14148574]

“The FOMC minutes were rather cautious and pessimistic about
the U.S. economic outlook, which is negative for the dollar,”
said Youna Park, Commerzbank currency strategist in Frankfurt.

U.S. industrial output and jobless claims will be watched
later in the day [ECI/US] while JP Morgan earnings are also in

At 0832 GMT, the dollar index (Read more about the global trade. ) (.DXY: ) was down 0.4 percent at
83.145, having hit a two-month low of 83.104.

The index dipped through support at around 83.15, a 38.2
percent retracement of its rise from a low of 74.17 in November
2009 to a high of 88.59 on June 8.

The euro (EUR=: ) rose 0.2 percent to a two-month high of
$1.2782 on the EBS trading platform, while the dollar also hit a
one-week low against the yen (JPY=: ) around 87.86 yen.

Charts looked bearish for the dollar after the greenback
failed the previous day to rise above 89.23 yen — a 38.2
percent Fibonacci retracement of the dollar’s fall from its June
high of 92.68 yen to a July 1 low of 86.96 yen, traders said.

“U.S. data will be a very important market-moving factor
today, especially after the minutes from the Federal Reserve’s
last meeting fanned speculation of further policy easing,” said
Hideki Hayashi, global economist at Mizuho Securities in Tokyo.


The Australian dollar stood at $0.8797 (AUD=D4: ), down 0.5
percent on the day.

Data showed China’s economic growth slowed to 10.3 percent
in the second quarter from 11.9 percent in the first quarter in
response to the fading effect of government fiscal and monetary
stimulus. [ID:nTOE66D060]

The release initially boosted the Aussie as the data was not
as bad as market rumours had suggested ahead of the release, but
the figures were still slightly weaker than forecast and it
resumed falls in the European session.

(Additional reporting by Rika Otsuka in Tokyo; Editing by
Toby Chopra)

FOREX-Dollar index at 2-mth low on dovish Fed minutes