The U.S. dollar was weak against its peers as traders continued to focus on stimulus negotiations, the developments on the Brexit front and the European Central Bank's monetary policy statement.
Data on U.S. jobless claims and consumer price inflation also impacted dollar's movements.
Data from the Labor Department showed a significant increase in first-time claims for U.S. unemployment benefits in the week ended December 5th.
The report said initial jobless claims jumped to 853,000, an increase of 137,000 from the previous week's revised level of 716,000. Economists had expected jobless claims to rise to 725,000 from the 712,000 originally reported for the previous week.
With the much bigger than expected increase, jobless claims reached their highest level since hitting 873,000 in the week ended September 19th.
A separate report released by the Labor Department showed a modest increase in U.S. consumer prices in the month of November.
The report said the consumer price index rose by 0.2% in November after coming in unchanged in October. The uptick in consumer prices matched economist estimates.
The dollar index, which slid to a low of 90.67 around mid morning, after moving along the flat line in the Asian session, was last seen hovering around 90.80, down 0.31% from previous close.
Against the Euro, the dollar weakened to $1.2158 before recovering some lost ground. Still, at $1.2141, it was down nearly 0.5% against the Euro.
As expected, the European Central Bank maintained its refi rate at 0% and the deposit rate at -0.5%. The bank increased the size of asset purchases under it pandemic emergency purchase programme, or PEPP, by EUR 500 billion to a total of EUR 1,850 billion. The purchase horizon was extended to at least the end of March 2022 from March 2021.
The Pound Sterling lost ground against the greenback, fetching $1.3298 a unit, falling more than 0.8% from Wednesday's close. The meeting between British Prime Minister Boris Johnson and European Commission president Ursula von der Leyen to strike a post-Brexit trade deal ended without a breakthrough and they agreed that a firm decision on the future of the talks would be made by the end of this weekend.
The European Union Chief said that they remained far apart on key issues and urged EU and UK negotiating teams to immediately reconvene to try to bridge gaps.
The PM and Von der Leyen agreed to make a decision on deal or no deal outcome by the end of the weekend.
The two sides remained far apart on key issues such as fisheries and level playing field and it is unclear whether these could be resolved.
Data from the Office for National Statistics showed that the UK economy expanded for the sixth straight month in October but the pace of growth moderated as expected.
Gross domestic product climbed 0.4% month-on-month, slower than the 1.1% growth seen in September. This was the sixth consecutive monthly growth.
The Yen was flat at 104.24 a dollar, after having weakened to 104.58 in the Asian session.
The Aussie was stronger, gaining more than 1.2% with a unit fetching US$0.7536.
The Swiss franc was up by about 0.3% at 0.8867 a dollar. The Loonie was at 1.2738 a dollar, up 0.6%, thanks to higher crude oil prices.
The material has been provided by InstaForex Company - www.instaforex.com
source http://www.mt5.com/forex_news/quickview/2168708/
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