The dollar experienced a decline in value after the release of weaker-than-anticipated manufacturing data. The Institute for Supply Management (ISM) reported a drop in its manufacturing index, which triggered concerns among investors regarding the robustness of the U.S. economic recovery.

The ISM index, a key indicator of manufacturing activity, fell below expectations, signaling a potential slowdown in the sector. This raised doubts about the overall health of the economy and prompted investors to reassess their positions in the currency market.

Analysts noted that the weaker data could lead the Federal Reserve to adopt a more cautious approach to raising interest rates, further weighing on the dollar. The currency’s decline was observed against major currencies, including the euro and the Japanese yen.

Market participants will be closely monitoring upcoming economic data releases and statements from Federal Reserve officials for further clues about the future direction of monetary policy and the dollar’s trajectory.