Dollar Loses Ground Against Major Counterparts On Weak Economic Data

(RTTNews) - The U.S. dollar drifted lower against some of its major counterparts on Thursday after data showed a bigger-than-expected increase in first-time jobless claims in the U.S. last week.

A report showing an unexpected contraction in Philadelphia-area manufacturing activity in the month of April weighed as well on the currency.

Data from the Labor Department showed that initial jobless claims crept up to 245,000 in the week ended April 14, an increase of 5,000 from the previous week's revised level of 240,000.

Economists had expected jobless claims to inch up to 240,000 from the 239,000 originally reported for the previous week.

Philadelphia-area manufacturing activity unexpectedly contracted at an accelerated rate in the month of April, according to a report released by the Federal Reserve Bank of Philadelphia.

The Philly Fed said its diffusion index for current activity slumped to a negative 31.3 in April from a negative 23.2 in March, with a negative reading indicating a contraction. Economists had expected the index rise to a negative

The latest batch of economic data has raised concerns the U.S. economy could slip into a recession later this year, and the Fed may well have to stop its tightening cycle from June.

The dollar index, which rose to 102.13, dropped to 101.63 around mid morning and is hovering around 101.80 now, down 0.16% from the previous close.

Against the Euro, the dollar has weakened to 1.0970, down from Wednesday's closing level of 1.0956.

The dollar is trading at 1.2442 against Pound Sterling down after having firmed to 1.2405 in the European session.

Against the Japanese currency, the dollar has weakened to 134.24 yen from 134.73 yen. Against the Aussie, the dollar has dropped to 0.6741, losing more than 0.4%.

The Swiss franc is firm against the dollar at CHF 0.8926, while the Loonie is weak at 1.3479 a dollar due to lower crude oil prices.