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    Dollar index at 5-week lows on diminished rate hike bets

    The dollar fell to five week lows against a basket of the other major currencies on Wednesday as markets continued to adjust to diminished expectations for a near term rate hike by the Federal Reserve.

    The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.11% at 93.75, the lowest level since May 5.

    Markets have pushed back expectations on the timing of the next rate hike by the U.S. central bank after Friday’s dismal employment report for May, which showed that the economy added just 38,000 jobs last month, the smallest increase since September 2010.

    A speech by Fed Chair Janet Yellen on Monday indicated that interest rates won’t rise until uncertainty over the economic outlook is resolved.

    Yellen said she expects the economic recovery to continue but gave no indications on the timing of a next rate increase.

    The Fed raised interest rates for the first time in almost a decade in December.

    The dollar was lower against the yen, with USD/JPY down 0.33% at 107.00 after falling as low as 106.72 earlier.

    The dollar recovered some ground after data showing that China’s imports rose more than expected in May, adding to hopes that the economy is steadying.

    The euro was trading near five-week highs, with EUR/USD at 1.1369.

    Sterling edged lower, with GBP/USD easing 0.11% to 1.4532.

    The pound ended the previous session with gains of 0.7% after opinion polls showing the Remain campaign with a lead over the Leave campaign ahead of the June 23 European Union referendum.


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