06.05.202120:47:00UTC+00Dollar Loses Ground Against Other Major Currencies

The U.S. dollar was weak against most of its peers on Thursday as some upbeat economic data from the U.S. and Europe dimmed the demand for the safe haven currency.

Data released by the Labor Department showed first-time claims for U.S. unemployment benefits fell by much more than expected in the week ended May 1st.

The report said initial jobless claims slid to 498,000, a decrease of 92,000 from the previous week's revised level of 590,000. Economists had expected initial jobless claims to edge down to 540,000 from the 553,000 originally reported for the previous week.

The bigger than expected decrease once again dragged jobless claims down their lowest level since the early days of the coronavirus pandemic.

Another report from the Labor Department showed labor productivity rebounded by more than expected in the first quarter of 2021.

The report said labor productivity spiked by 5.4% in the first quarter after tumbling by a revised 3.8% in the fourth quarter of 2020. Economists had expected productivity to surge up by 4.3% compared to the 4.2% nosedive that had been reported for the previous quarter.

On Friday, the Labor Department is scheduled to release its more closely watched monthly employment report for April.

Economists currently expect employment to jump by 978,000 jobs in April after surging up by 916,000 jobs in May. The unemployment rate is also expected to dip to 5.8 percent from 6.0 percent.

The dollar index dropped to 90.88, giving up nearly 0.5% from previous close.

Against the Euro, the dollar weakened to $1.2062, nearly 0.5% down from Wednesday's close of $1.2006.

The Pound Sterling was slightly weak against the greenback, fetching $1.3892 a unit. The Bank of England today kept its interest rate and quantitative easing unchanged. The nine-member Monetary Policy Committee, headed by Governor Andrew Bailey, unanimously voted to hold the interest rate at 0.10%.

The bank retained the stock of corporate bond purchases at GBP 20 billion and the government bond purchases at GBP 875 billion.

The bank forecast the UK economy to grow sharply by 7.25% instead of 5% estimated in February. But, the outlook for 2022 was lowered to 5.75% from 7.25%, while that for 2023 was retained at 1.25%.

The Yen was stronger at 109.09 a dollar, sliding from 109.20 a dollar.

Against the Aussie, the dollar weakened by about 0.45% at 0.7782 a unit of the Australian currency.

The Swiss franc firmed up to 0.9084 a dollar, gaining from 0.9130, while the Loonie strengthened to C$1.2161, advancing from C$1.2267.