Forexpros – The U.S. dollar was mixed against its major counterparts on Thursday, following a string of U.S. data, while markets continued to mull the implications of a massive liquidity injection by the European Central Bank.
During U.S. morning trade, the dollar was fractionally higher against the euro, with EUR/USD dipping 0.05% to hit 1.3319.
The euro found support after the International Swaps and Derivatives Association said the restructuring of Greek government bonds would not trigger payouts on derivative instruments known as credit default swaps.
But sentiment on the euro remained fragile, as concerns over the effectiveness of Wednesday’s massive liquidity injection by the ECB weighed.
Meanwhile, fears over the economic outlook for the region were exacerbated after official data showed that the unemployment rate in the single currency bloc climbed to the highest level since the inception of the euro in January, while the annualized rate of inflation also increased.
Another report showed that the euro zone’s manufacturing sector contracted for the seventh consecutive month in February.
But the greenback was lower against the pound, with GBP/USD rising 0.16% to hit 1.5941.
Sterling found support after data showed the manufacturing sector in the U.K. grew in February, albeit at a slightly slower-than-forecast pace, adding to hopes that the sector will fuel overall economic growth in the first quarter.
The greenback edged higher against the yen and the Swiss franc, with USD/JPY inching up 0.04% to hit 81.16 and USD/CHF easing up 0.02% to hit 0.9047.
Earlier in the day, government data showed that capital spending in Japan increased by the most in five years in the fourth quarter, adding to indications that the economy is recovering.
In Switzerland, official data showed that the economy expanded at an annualized rate of 1.3% in the in the final three months of 2011, above expectations for a 1.1% increase.
A separate report showed that manufacturing activity in Switzerland improved more-than-expected in February, but remained in contraction territory for the fifth consecutive month.
The greenback was lower against its Canadian, Australian and New Zealand counterparts, with USD/CAD shedding 0.42% to hit 0.9856, AUD/USD rising 0.62% to hit 1.0797 and NZD/USD climbing 0.58% to hit 0.8392.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, slid 0.16% to hit 78.72.
In the U.S., the Institute for Supply Management said manufacturing activity expanded at a slower rate than expected in February.
The ISM index of purchasing managers’ fell to 52.4 last month, from a reading of 54.1 in January, disappointing expectations for an increase to 54.6.
Government data showed that U.S. initial jobless claims declined modestly last week, holding steady near the lowest level since March 2008.
The U.S. Department of Labor said that initial claims for state unemployment benefits fell 2,000 to a seasonally adjusted 351,000. The previous week’s figure was revised up to 353,000 from the previously reported 351,000.
Separate reports showed that the U.S. core personal consumption expenditure index rose broadly in line with market expectations in January, while personal spending and personal income both rose less-than-expected.
The data came one day after Federal Reserve Chairman Ben Bernanke dampened expectations for a third round of monetary easing, after he acknowledged the recent improvement in the labor market and said that higher oil prices could push up inflation.
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