Investing.com – The dollar traded lower against a basket of global currencies on Friday, as U.S. political drama continued to weigh on sentiment, raising doubts over the Trump administration’s ability to push through its pro-growth economic agenda.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.22% to 93.42.
U.S. political drama remained front and centre on Friday, after Donald Trump told aides he has decided to remove Steve Bannon from his post as chief White house advisor, according to a White House official.
"White House Chief of Staff John Kelly and Steve Bannon have mutually agreed today would be Steve's last day. We are grateful for his service and wish him the best," White House press secretary Sarah Huckabee Sanders said in a statement.
The latest twist in the U.S. political saga comes on the back of growing concerns that recent controversies engulfing U.S. President Donald Trump could derail the president’s ability to push through his pro-growth agenda.
Losses in the greenback, however, were capped as a preliminary reading for consumer sentiment data for August topped expectations adding to narrative of a strengthening U.S. economy.
The consumer sentiment index, a survey of consumers by The University of Michigan, rose to 97.6 in August. Economists estimated the index would climb to 94 from the 93.4 reading in July.
The greenback struggled to pare gains against the yen, which is often favoured as a safe haven currency in times of market turmoil, as USD/JPY fell 0.08% to Y109.49.
Elsewhere, USD/CAD lost 0.85% to C$1.2572, despite a weaker-than-expected reading for Canadian inflation for July.
EUR/USD rose by 0.17% to $1.1743 shrugging off a downturn in sentiment, following minutes from the ECB’s July policy meeting showing officials warned that the recent surge in the euro could hamper the central bank’s efforts to get inflation closer to its target of below, but close to, 2%.
GBP/USD fell 0.09% to $1.2858.