Dollar trims losses after upbeat U.S. jobless claims

The dollar trimmed losses against a basket of other major currencies on Thursday, as data showing that the number of people filing unemployment assistance in the U.S. last week fell to a five-week low sparked optimism over the strength of the job market.

In a report, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending March 21 declined by 9,000 to 282,000 from the previous week’s total of 291,000.

Analysts had expected initial jobless claims to fall by 1,000 to 290,000 last week.

The dollar has been under pressure since the Federal Reserve indicated last week that it may raise interest rates more gradually than markets had expected.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.08% to 97.00, off session lows of 96.32.

EUR/USD was steady at 1.0974, down from three-week highs of to 1.1049 hit earlier in the day.

The euro found support earlier, after data showed that the Gfk German consumer climate index was set to rise to 10.0 in April from a reading of 9.7 the previous month, compared to expectations for an uptick to 9.8.

But investors remained cautious as Greece failed in a bid on Wednesday to secure a quick cash payment from the euro zone rescue fund to help stave off potential bankruptcy next month.

Athens had appealed for the European Financial Stability Facility to return €1.2 billion it said it had overpaid when it transferred bonds intended for bank recapitalization this month.

The Greek government is expected to present a detailed list of proposed reforms to its eurozone partners by next Monday.

The pound was also little changed, with GBP/USD at 1.4888, pulling away from a one-week high of 1.4994.

The U.K. Office for National Statistics earlier reported that retail sales increased 0.7% last month, above forecasts for a gain of 0.4%.

Core retail sales, which exclude automobile sales, rose 0.7% last month, compared to forecasts for a 0.4% rise, after falling 0.3% in January.

Separately, the Confederation of British Industry said that its index of realized sales rose to 18 in March from 1 the previous month, exceeding expectations for a reading of 15.

Elsewhere, the dollar was still lower against the yen and the Swiss franc, with USD/JPY down 0.46% to 118.94 and with USD/CHF retreating 0.42% to 0.9556.

The Australian, New Zealand and Canadian dollars pared earlier gains but remained broadly stronger, with AUD/USD adding 0.18% to 0.7859 and NZD/USD rising 0.20% to 0.7622, while USD/CAD sliding 0.53% to trade at 1.2452.