Dollar Weakens As Soft ADP, GDP Data Support Fed Pause Hopes

(RTTNews) - The U.S. dollar depreciated against its major counterparts in the New York session on Wednesday, as ADP private sector job growth slowed in August and economy grew less than previously estimated in the second quarter, cementing expectations of a pause in the interest rate hike by the Federal Reserve.

Data from payroll processor ADP showed that private sector employment climbed by 177,000 jobs in August after surging by an upwardly revised 371,000 jobs in July.

Economists had expected private sector employment to advance by 195,000 jobs compared to the jump of 324,000 jobs originally reported for the previous month.

Revised data from the Commerce Department showed that the increase in gross domestic product in the second quarter was downwardly revised to 2.1 percent from the previously reported 2.4 percent. Economists had expected the pace of GDP growth to be unrevised.

Softer-than-expected economic data bolstered speculation that the Fed might stop raising rates this year.

The greenback fell to fresh 2-week lows of 0.8744 against the franc and 1.0945 against the euro, from yesterday's closing values of 0.8783 and 1.0879, respectively. The greenback is likely to challenge support around 0.86 against the franc and 1.11 against the euro.

The greenback weakened to a 1-week low of 1.2746 against the pound and a 6-day low of 145.55 against the yen, from Tuesday's close of 1.2643 and 145.85, respectively. The greenback may face support around 1.30 against the pound and 138.5 against the yen.

The greenback dropped to near a 3-week low of 0.6006 against the kiwi and a fresh 2-week low of 0.6522 against the aussie, from yesterday's closing quotes of 0.5971 and 0.6480, respectively. The greenback is seen finding support around 0.62 against the kiwi and 0.68 against the aussie.

The greenback was down against the loonie, at a 6-day low of 1.3524. At yesterday's close, the pair was quoted at 1.3551. If it drops further, it may find support around the 1.33 area.