CANBERA (dpa-AFX) - The U.S. dollar dropped against its major counterparts in the New York session on Monday, following dovish comments from Federal Reserve Governor Michelle Bowman.
In her speech in Prague, Bowman favored a rate cut 'as soon' as July if inflationary pressures remain contained.
'We should also recognize that downside risks to our employment mandate could soon become more salient, given recent softness in spending and signs of fragility in the labor market,' Bowman said.
Bowman downplayed the inflationary impact of recent trade policy changes and noted that the underlying trend in core inflation is moving much closer to the Fed's 2% target than is currently apparent in the data.
Fed Chair Jerome Powell will deliver semiannual congressional testimony on Tuesday and Wednesday.
The greenback fell to 6-day lows of 1.1577 against the euro and 1.3530 against the pound, from an early 4-day high of 1.1451 and near a 5-week high of 1.3369, respectively. The next possible support for the currency is seen around 1.17 against the euro and 1.37 against the pound.
The greenback dropped to a 1-week low of 0.8115 against the franc, from an early 4-day high of 0.8195. If the currency falls further, it is likely to find support around the 0.80 level.
The greenback declined to 146.00 against the yen, from an early nearly 6-week high of 148.02. The currency may find support around the 142.00 level.
The greenback weakened to 0.6458 against the aussie, 0.5974 against the kiwi and 1.3725 against the loonie, from an early nearly 6-week high of 0.6372, 5-week high of 0.5883 and more than a 3-week high of 1.3798, respectively. The currency is poised to find support around 0.68 against the aussie, 0.62 against the kiwi and 1.35 against the loonie.
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