NEW YORK, July 24 — A gauge of the dollar headed for its worst week in more than a month as traders pared their confidence in further gains before the Federal Reserve meets July 30 and considers plans to raise interest rates this year.

Traders turned the least bullish on the greenback this year against seven of 10 major currencies, data compiled by Bloomberg show.

A slew of reports next week including US second-quarter growth and durable goods orders may offer more clarity about prospects for central bank action. Policy makers have said they expect to tighten this year while stressing their decisions will be its data-dependent.

“Dollar buying has been advancing on expectations of a Fed rate hike while the risk of a stronger dollar conversely delaying rate hikes has also weighed on it,” said Shinji Kureda, Tokyo-based head of FX trading at Sumitomo Mitsui Banking Corp.

“Falling commodity currencies on the back of the dollar strength and falling US yields also weigh on the dollar against the yen.”

The Bloomberg Dollar Spot Index, which tracks the greenback versus 10 of its major peers, was little changed at 1,207.35 as of 9:37am in Tokyo from 1,206.64 in New York, after trading near its strongest level since April on Wednesday.

It is set for a 0.1 per cent drop for the week, which would be the first such decline since the period ended June 19.

Loonie’s tumble

Traders were the least bullish on the US currency against its Canadian counterpart since October 2010 as of yesterday, while sentiment for the greenback was the weakest over the euro since October 2013.

The loonie dropped more than 6 per cent over the past three months as prices for its key export, oil, tumbled. The currency reached the weakest since 2009 at C$1.3053 (RM3.82) per greenback on July 22 and was recently at C$1.3025.

The US dollar was little changed at US$1.0985 per euro, after reaching US$1.1018 (RM4.20) yesterday, the weakest level since July 15.

The greenback had pared earlier losses yesterday after a report showed the fewest Americans in four decades filed applications for unemployment benefits last week, supporting Fed moves to raise interest rates this year.

“Upcoming data are extremely important,” said Yujiro Goto, a currency strategist at Nomura Holdings Inc. in London.

“It will be important for whether the Fed can raise rates in September.” — Bloomberg