The U.S. dollar held near a one-month low against major currencies on Tuesday, as the effects of Friday's weak jobs report continued to weigh and as Federal Reserve Chairman Jerome Powell's comments to Congress awaited clues on the path of interest rates.
The euro maintained its level, after the sharp fluctuations it witnessed in yesterday's session, Monday, after the parliamentary elections in France ended without a clear majority for any of the competing coalitions, which may lead to a state of political stagnation and the formation of a hung parliament, despite its potential positive impact on financial concerns associated with a clear victory for left-wing or far-right parties, according to Reuters.
The US dollar index, which measures the currency against the euro, pound, yen and three other major currencies, was steady at 104.99, holding close to yesterday's low of 104.80, its lowest in three and a half weeks.
The index fell 0.9% last week, exacerbated by Friday's monthly jobs report, which boosted bets that the Federal Reserve will soon start cutting interest rates.
Traders now see about a 76% chance of a rate cut at the September meeting, up from 66% a week ago, with another cut expected by December.
Chairman Powell will testify before Congress for two days, beginning later Tuesday in the Senate and followed by the House of Representatives on Wednesday.
Market watchers said Thursday's consumer price data could also be crucial, with the latest figures showing a lull from unexpectedly high levels at the start of the year.
The euro rose 0.06% to $1.08295, near a four-week high of $1.0845 hit on Monday.
The pound is trading at $1.2809, after rising to $1.28455 on Monday, its strongest level since June 12.
Traders currently see a 61% chance of the Bank of England cutting interest rates on August 1, which analysts at Commonwealth Bank of Australia see as too high.
The yen was little changed at 160.945 per dollar, finding some footing on the week after rebounding from a 38-year low of 161.96 hit on Wednesday.
