Dollar Declines After Credit Rating Downgrade

The dollar fell against a range of other major currencies yesterday, hitting a 10-day low against the yen, as traders assessed the impact of a surprise U.S. government credit rating downgrade and trade tensions weighed on sentiment.

Moody’s, the last major rating agency to downgrade the United States, cut its top sovereign credit rating by one notch on Friday, citing concerns about Washington’s $36 trillion debt pile.

The news sent the dollar lower against other major currencies, ending four consecutive weeks of gains, supported by growing optimism over U.S. trade deals and improved relations with China, which eased fears of a global recession.

The dollar fell about 0.7% to 144.665 yen, its lowest level since May 8. The euro rose 0.73% to $1.1247.