Investing.com – The dollar languished near session lows, pressured by falling U.S. bond yields as analysts downplayed the strong third-quarter U.S. economic growth Friday, warning the “sugar-high” economy was set for a bumpy road.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.25% to 96.
Gross domestic product increased at a 3.5% annual rate in the July-September period, the Commerce Department said in its preliminary estimate on Friday, topping economists’ estimates for a 3.3% increase.
U.S. bond yields fell following the report, pressuring the dollar, as a deeper look into the report signaled growth could be set for bumpy road ahead as the tailwinds from President Donald Trump’s tax cuts wear off.
Disappointing business investment suggested “the boost in capex from tax cuts and deregulation was likely front-loaded and fading quickly,” BNP Paribas (PA:BNPP) said. “We continue to expect growth to slow from here as the sugar high in consumer spending turns into a sugar low.”
The dollar was also held back by a rebound in both sterling and the euro from session lows.