LONDON/SYDNEY, July 17 (Reuters) – The dollar edged lower on Monday against a basket of currencies after suffering its biggest weekly drop of the year as traders waited on economic data and policy decisions before selling it down any further.
The euro continued climbing, rising 0.1% to $1.1234, after hitting a fresh 16-month high earlier in the day. Versus the yen the dollar fell 0.28% to 138.36 yen per dollar, after touching its lowest against the Japanese currency in two months on Friday.
“Last week’s U.S. disinflation shock altered the FX landscape, but a few days without key data releases will tell us whether that impulse can keep the dollar on the back foot as the FOMC risk event draws nearer,” Francesco Pesole, FX strategist at ING, said.
“Euro/dollar appears a bit overstretched in the short term and could face a correction this week,” he added.
Last week’s U.S. inflation data fuelled investors’ bets that the Federal Reserve was…
