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Dollar slides lower vs. yen, euro

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Investing.com - The broadly weaker dollar drifted lower against the yen and the euro in thin trade on Monday as volumes in foreign exchange markets declined due to the summer holidays.

During European afternoon trade, the dollar was down against the yen, with USD/JPY falling 0.67% to 99.92, after falling to lows of 99.61 earlier in the session.

The yen was broadly higher following Sunday's elections in Japan's upper house, which gave Japanese Prime Minister Shinzo Abe's ruling coalition a majority in both houses of parliament.

The majority will allow Prime Minister Abe to continue to push through a series of structural reforms aimed at spurring economic growth and fighting deflation.

Demand for the dollar continued to be underpinned by expectations that the Federal Reserve will start to unwind its bond purchase program later this year.

Over the weekend, the Group of 20 nations stressed the need for a "careful" shift away from monetary easing so that market volatility does not negatively impact on the global recovery.

Finance ministers and central bankers from the G20 nations said Saturday that future changes to monetary policy should be "carefully calibrated and clearly communicated."

The dollar was also lower against the euro, with EUR/USD climbing 0.22% to 1.3167.

The single currency was boosted as the yield on Portuguese 10-year bonds fell to 6.4% from 6.92% at the close of trade on Friday, after political leaders resolved a deadlock that had threatened to derail the country's EUR78 billion bailout program.

Elsewhere, the dollar was down against the pound and the Swiss franc, with GBP/USD rising 0.44% to 1.5335 and USD/CHF down 0.23% to 0.9393.

The greenback was mixed against its Australian, New Zealand and Canadian counterparts, with AUD/USD rising 0.53% to 0.9228, NZD/USD edging up 0.08% to 0.7936 and USD/CAD losing 0.22% to trade at 1.0343.

The New Zealand dollar remained under pressure following a magnitude 6.5 earthquake in Wellington on Sunday.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.30% to 82.48.

The U.S. was to release private sector data on existing home sales later in the trading day.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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