Dollar hits 5-week low as traders get Fed jitters

Dollar hits 5-week low as traders get Fed jitters

Axel Merk, president and chief investment officer of Merk Investments, said the euro had the potential to rise to $ 1.40 this year and $ 1.50 next year because European Central Bank monetary policy was more restrictive than in the United States.

The euro is around 10 percent higher against the dollar since European Central Bank President Mario Draghi vowed a year ago to do whatever it takes to save the single currency, calming investors’ fears about the euro zone breaking up.

The dollar fell to a four-week low of 97.94 yen, according to Reuters data, and was last down 1.1 percent at 98.22 yen.

(Read more: Weak yen? Think again)

Despite Friday’s losses, analysts said the U.S. currency is expected to be well supported over the coming weeks on expectations the Fed may scale back bond purchases as early as September.

A survey on Friday showed U.S. consumer sentiment rose in July to the highest level in six years as Americans felt better about the current economic climate, though they expected to see a slower rate of growth in the year ahead.

For the week, the euro gained about 0.9 percent against the dollar, its third straight week of gains. The dollar lost 2.3 percent against the yen, its worst week since mid-June.

—By Reuters.

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