Dollar steadies after weak China data; Fed minutes eyed

By Saikat Chatterjee

LONDON (Reuters) – The dollar held its ground against major peers on Monday as disappointing monthly activity data from China helped the greenback claw back some losses after a shocking slump in consumer sentiment on Friday weakened the U.S. unit.

Against a basket of other currencies, the greenback broadly steadied at 92.53 after falling to a one-week low of 92.468 on Friday. Its gains were the most pronounced against the Chinese yuan and the Australian dollar, against which it advanced 0.1% and 0.5% respectively.

July retail sales, industrial production and fixed asset investment were all weaker than expected as the latest COVID-19 outbreak weighed on the world’s second-biggest economy.

But long positions on the greenback swelled to their biggest levels since March 2020 suggesting the move lower was more a temporary setback than the beginning of a structural downtrend.