The dollar experienced broad-based weakness after the release of U.S. retail sales figures that fell short of expectations. The report indicated a potential slowdown in consumer spending, a key driver of economic growth.

Market Reaction

The weaker-than-anticipated data triggered a sell-off in the dollar, as investors adjusted their expectations for future interest rate hikes by the Federal Reserve. The euro, pound, and yen all gained ground against the dollar.

Key Factors

• Retail Sales Data: The primary catalyst for the dollar’s decline.
• Interest Rate Expectations: Reduced likelihood of near-term rate increases.
• Safe-Haven Demand: Some investors sought refuge in assets like gold and the Swiss franc.

Analysts suggest that the dollar’s near-term performance will be heavily influenced by upcoming economic data releases and any signals from the Federal Reserve regarding its monetary policy outlook.