The euro touched a seven-week low against the dollar after European
Central Bank President Jean- Claude Trichet said economic growth will
slow, reducing expectations policy makers will raise interest rates
further.
The European single currency also declined against the yen and the
Canadian dollar as the ECB kept its main rate at a seven-year high of
4.25 percent.
``The slowing in the euro zone is starting to register with policy
makers,'' said Jonathan Gencher, vice president of foreign exchange
sales at BMO Capital Markets in Toronto. ``Not long ago, everyone was
looking to find a reason to sell the dollar. The market is going to
start to focus on reasons to sell the euro.''
Traders pared bets the ECB will raise the main refinancing rate for a second time this year.
The Dollar Index on the ICE futures exchange, which tracks the dollar
against the currencies of six U.S. trading partners, reached 74.477,
the highest since Feb. 27.
More Americans unexpectedly signed contracts to purchase previously
owned homes in June, a sign that lower prices are drawing some buyers
back into the market. The index of pending home resales rose 5.3
percent after a revised 4.9 percent decline in May, the National
Association of Realtors said today in Washington. The gain is the third
this year. Economists predicted a 1 percent drop.