Dollar falls most since April amid pessimism on economic growth

New Zealand's dollar climbed to within a half-cent of a record after the nation's central bank increased interest rates this month for a third time. The pound headed for its longest run of quarterly gains versus the dollar since 2007 as U.K. growth boosted the case for a jump in interest rates. The U.S. economy added 215,000 jobs in June, about the same as in May, a report next week is forecast to show, Bloomberg reports.
"Growth for the year is set to be uninspiring," said Paul Robson, a senior foreign-exchange strategist at Royal Bank of Scotland Group Plc in London. "The dollar's just staying relatively weak until the data change."
The Bloomberg Dollar Spot Index, which tracks the U.S. currency against 10 major counterparts, fell 0.5 percent to 1,005.04 in New York, the third straight weekly decline and the biggest since April 11.
The greenback dropped 0.6 percent to 101.42 yen and touched 101.32, the lowest since May 21. It has fallen 0.3 percent this month, dropped 1.8 percent this quarter and lost 3.7 percent this year against the Japanese currency.
The dollar depreciated 0.4 percent to $1.3649 per euro. It has slipped 0.1 percent in June against the 18-nation currency while gaining 0.9 percent this quarter and 0.7 percent in 2014. The yen rose 0.3 percent this week and 0.2 percent this month to 138.41 per euro.
Low Volatility
A gauge of currency price swings reached a record low. The JPMorgan Global FX Volatility Index fell to 5.49 percent, the least in data compiled by Bloomberg going back to 1992.
New Zealand's currency is the best performer this month among the U.S. dollar's 16 major counterparts, advancing 3.2 percent, and the Brazilian real is No. 2, rising 2.1 percent. Norway's krone lost the most, sliding 2.6 percent.
The kiwi, as the New Zealand dollar is known, climbed after Reserve Bank Governor Graeme Wheeler raised the benchmark interest rate to 3.25 percent June 11. The currency gained 0.9 percent this week to 87.77 U.S. cents and touched 87.94. It reached 88.43 cents on Aug. 1, 2011, the strongest level since exchange-rate controls were scrapped in 1985.
"Given the momentum behind the kiwi at the moment, the prospects are really quite high in the near term that we reach the record," said Kymberly Martin, a market strategist in Wellington at Bank of New Zealand Ltd. "Interest-rate differentials and low volatility are currently both in favor of the New Zealand dollar."

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