The dollar sank on news that two additional Republican senators had opposed the Republican health-care bill. There are now four GOP senators who have voiced opposition to the bill, which is likely enough to stop it dead in its tracks: The GOP holds 52 seats in the Senate.
The dollar index, which measures the dollar against a basket of currencies, traded at 94.744 at 3:08 p.m. HK/SIN, its weakest levels since September 2016. Against the yen, the greenback fetched 112.25 yen, off levels around the 113 handle seen the last two weeks.
Meanwhile, the euro gained against the dollar to trade at $1.1516.
Investors were now more doubtful over the future of U.S. tax reforms, given the difficulty the health-care bill has faced in making progress, OANDA senior trader Stephen Innes told CNBC. The health-care bill being passed would have added money in the coffers for the government to enact subsequent tax reforms, Innes added.
“The market has a tendency to overreact, but it looks like another nail in the coffin (for the bill),” Innes said.
Gold prices traded at around a two-week high amid uncertainty over future increases in U.S. interest rates. Prices of the precious metal usually have an inverse relationship with interest rates: Higher interest rates make the opportunity cost of holding gold higher.
Spot gold traded as high as $1,238.27 an ounce from a low of $1,233.02 seen earlier in the session. The precious metal traded at $1,234.27 at 3:13 p.m. HK/SIN.
Markets also digested better-than-expected second-quarter GDP from China released Monday. The Chinese growth rate was 6.9 percent on…