The dollar weakened amid speculation minutes of last month’s Federal Reserve meeting will show the central is moving closer to expanding its stimulus program, boosting demand for higher-yielding currencies. The U.S. currency slid against all but one of its 16 major peers tracked by Bloomberg, dropping most versus the Australian dollar and Mexican peso. The Fed, led by Chairman Ben S. Bernanke, has already bought $2.3 trillion of bonds in two rounds of so-called quantitative easing, or QE, from December 2008 to June 2011, seeking to cap borrowing costs and stimulate the economy. The 17-nation euro dropped to a record low versus Australia’s dollar as data showed German inflation slowed. “There could be some suggestion that the Fed is ready to ease as early as the August meeting,� said Ankita Dudani, a foreign-exchange strategist at Royal Bank of Scotland Group Plc in London. “That will play negative for the dollar, purely on the back of more dollars in circulation means the dollar goes down.� The dollar fell 0.2 percent to 79.28 yen at 9:59 a.m. London time. Against the euro it was 0.3 percent weaker at $1.2290. Japan’s currency was little changed at 97.44 per euro after reaching 97.10, the strongest level since June 5. Europe’s shared currency slid as much as 0.4 percent to a record low A$1.19769. The Dollar Index (DXY), which IntercontinentalExchange Inc. uses to track the greenback against the currencies of six major U.S. trade partners, slipped 0.3 percent to 83.154. It may fall below 83 today, RBS’s Dudani said. To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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