Gold Silver Reports — The dollar slid back to a 10-month low as President Donald Trump’s economic revitalization agenda once again faltered. European stocks dropped as some earnings disappointed, and gold climbed to the highest in two weeks.
The greenback lost ground against all but one of its G-10 peers on signs Trump’s health-care reform bill is effectively dead in its current form, after two more Republican senators announced their opposition to the plan. Sterling bucked the trend, slipping against the dollar as U.K. inflation unexpectedly slowed in June, while the euro surged ahead of this week’s ECB meeting. The Stoxx Europe 600 Index fell following a grim earnings report from Ericsson AB. Iron-ore futures hit their highest since May on strong demand from Chinese steel mills.
While many traders had already dialed back their expectations Trump will be able to execute his pro-growth policies, the apparent death of the health-care bill lent a risk-off tone to markets. Some notable investors have become less sanguine as global equities continue to trade near record highs.
“Any hopes of dollar support from a successful vote on the Senate’s health-care bill look to be vanishing,” said Rodrigo Catril, a currency strategist at National Australia Bank Ltd. in Sydney. “Near term, the dollar path of least resistance is down. We still think the data — inflation in particular — will provide the Fed with enough ammunition to hike in December and boost the dollar, but this is a fourth-quarter story.”