Forexpros – The U.S. dollar was broadly higher against its major counterparts on Thursday, as market sentiment weakened ahead of a highly anticipated European summit due to begin later in the day.
During European morning trade, the dollar was higher against the euro, with EUR/USD shedding 0.35% to hit 1.2424.
Sentiment on the euro was hit after a German government official indicated that the EU summit would not result in any detailed decisions and warned against high expectations among investors ahead of the outcome.
Earlier in the week, German Chancellor Angel Merkel reiterated her opposition to the idea of joint euro zone bonds, while EU Economic and Monetary Affairs Commissioner Olli Rehn said Wednesday that the summit would focus on short-term measures to stabilize markets and ease pressure on at-risk countries.
Meanwhile, the yield on Spanish 10-year bonds ticked up to 7%, the level that prompted Greece, Ireland and Portugal to seek international bailouts.
Also Thursday, official data showed that the number of unemployed people in Germany rose by 7,000 in June, above expectations for an increase of 5,000. The previous month’s figure was revised to a gain of 1,000 people from a previously reported flat reading.
Germany’s unemployment rate held steady at 6.8% in June.
The greenback was also higher against the pound, with GBP/USD falling 0.12% to hit 1.5547.
Official data showed earlier that the U.K.’s current account deficit widened more-than-expected during the first quarter of 2012 to GBP11.2 billion from a deficit of GBP7.2 billion in the preceding quarter.
A separate report showed that gross domestic product in the U.K. contracted at a seasonally adjusted rate of 0.3% during the first quarter, unchanged from a previous estimate.
The reports came after industry data showed that U.K. house prices fell by 0.6% in June, taking the annual pace of house price growth to the lowest reading since August 2009 and defying expectations for a modest 0.1% increase.
Elsewhere, the greenback was lower against the yen but higher against the Swiss franc, with USD/JPY declining 0.52% to hit 79.30 and USD/CHF rising 0.37% to hit 0.9667.
Government data showed earlier that retail sales in Japan rose more-than-anticipated in May, advancing 3.6% after a 5.7% increase the previous month.
In addition, the greenback was higher against its Canadian, Australian and New Zealand counterparts, with USD/CAD adding 0.24% to hit 1.0272, AUD/USD slipping 0.07% to hit 1.0072 and NZD/USD easing 0.03% to hit 0.7915.
The National Bank of New Zealand said that its index of business confidence declined to 12.6 in June from a reading of 27.1 the previous month.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.11%, to trade at 82.86.
Later in the day, the U.S. was to release government data on initial jobless claims, followed by revised data on first quarter economic growth.
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