U.S. dollar climbs after huge slump

The U.S. dollar increased against most major currencies on Monday after posting its worse weekly performance in three months last week.

The dollar index, which measures the greenback against six major peers, was down 2 percent last week after the Federal Reserve failed to offer clear timeline of further rate hikes. Worse-than-expected U.S. growth report also weighed on the dollar.

The index recovered 0.18 percent to 95.701 in late trading on Monday, which still lingered around the lowest level in three and a half weeks.

Analysts said Monday's modest dollar reversal was in response to a bit of an overreaction to last Friday's GDP (gross domestic product) release.

U.S. real gross domestic product (GDP) increased at an annual rate of 1.2 percent in the second quarter of 2016, well below market consensus of a 2.6-percent gain, according to the advance estimate by the Commerce Department Friday.

After concluding its two-day monetary policy meeting on Wednesday, the U.S. central bank left federal funds rate unchanged, reiterating that it continues to closely monitor inflation indicators and global economic developments.

The Fed gave no hint that it would raise rates soon, which will weigh on the greenback in the short term.

In late New York trading, the euro rose to 1.1169 dollars from 1.1166 dollars of the previous session, and the British pound dipped to 1.3193 dollars from 1.3239 dollars. The Australian dollar went down to 0.7565 dollars from 0.7598 dollars.

The dollar bought 102.31 Japanese yen, higher than 102.05 yen of the previous session. The dollar dipped to 0.9679 Swiss francs from 0.9694 Swiss francs, and it inched up to 1.3095 Canadian dollars from 1.3047 Canadian dollars. Endit