Forex – Dollar Set for Biggest Weekly Slump Since March as G7 Meeting Kicks-Off

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© Reuters.  © Reuters.

Investing.com – The U.S. dollar rose Friday but looks set to post its biggest weekly loss since March as traders remained wary of escalating trade tensions after the G7 meeting got underway.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.14% to 93.56.

With limited top-tier economic data on the calendar, traders shifted focus to escalating tensions between the United States and its allies as U.S. President Donald Trump went into the G7 meeting expecting a frosty reception after lashing out at Canada and the European Union.

Trump, in a tweet, accused the United States allies of levying “massive tariffs” and creating non-monetary barriers.

The Canadian dollar clawed back losses against the greenback as weaker labor market data from Canada failed to dampen investor expectations the Bank of Canada would raise rates in July.

Canadian employment fell by 7,500 in May according to the Labour Force Survey, undershooting expectations for gain of 17,500.

USD/CAD fell 0.15% to C$1.2951 from a session high of C$1.3037.

EUR/USD fell 0.23% $1.1772 on profit taking, while GBP/USD 0.10% to $1.3409 as Brexit concerns weighed on the latter pair a day after the UK government’s release of its post-Brexit plans for the Irish border.

Emerging market currencies were also in focus Friday as the Brazil’s real rallied sharply on positive inflation data, sending the USD/BRL tumbling 4.13% to 3.7439.

USD/JPY fell 0.21% as concerns over the prospect of a full-blown trade war stoked demand for safe-haven yen.

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