Dollar Loses Ground as Flynn Prepares to Testify Against Trump

The US dollar fell against most-traded currencies (though not the Great Britain pound) today as US politics took the center stage yet again, distracting market participants from other fundamental factors that could have influenced the currency.

US economic data was mixed today, with slowing manufacturing growth but unexpectedly fast growth of the construction sector. But traders paid not attention to that after the report that US national security adviser Michael Flynn is prepared to testify that President Donald Trump directed him to make a contact with Russians. The dollar slumped after the news, though the sterling performed even worse despite the very good UK manufacturing data.

EUR/USD was down from 1.1903 to 1.1851 intraday before rebounding to 1.1892 as of 20:31 GMT today. GBP/USD dropped from 1.3523 to 1.3472.

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