Daily Afternoon Report 27.05.2016

The dollar held onto gains against the other major currencies on Friday, even after data showed that the U.S. economy grew at a slower pace than expected in the first quarter, as investors awaited a speech by Federal Reserve Chair Janet Yellen scheduled later in the day.

USD/JPY was down 0.13% at 109.63.

Official data showed that the second estimate of U.S. first quarter growth domestic product rose 0.8%, revised up from the initial reading of a 0.5% rise. Analysts had expected growth to settle at 0.9%.

Investors were eyeing comments by Fed Chair Janet Yellen due later Friday, for further hints on the timing of future rate hikes by the U.S. central bank.

The greenback posted sharp gains earlier in the week amid expectations for the Fed to raise interest rates in the near term after last week’s April Fed meeting minutes flagged a possible rate hike if the economy continues to improve.

Meanwhile, traders remained cautious with the yen after Group of Seven leaders said in a statement late Thursday that they committed to avoiding “competitive devaluation” of their currencies and warned against “disorderly” exchange-rate moves.

EUR/USD slipped 0.20% to 1.1172.

The dollar was higher against the pound and the Swiss franc, with GBP/USD down 0.16% at 1.4646 and with USD/CHF adding 0.15% to 0.9908.

The Australian and New Zealand dollars slipped lower, with AUD/USD down 0.11% at 0.7217 and with NZD/USD easing 0.09% to 0.6736.

Elsewhere, USD/CAD gained 0.35% to trade at 1.3026.

The commodity-currencies weakened as oil prices turned lower on Friday, amid fresh global supply glut concerns.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.18% at 95.31, moving closer to Wednesday’s two-month highs of 95.66.