The US dollar rose against major currencies on Thursday, extending the previous day's gains, as an unexpected rise in US weekly jobless claims and weaker-than-expected eurozone data spurred safe-haven demand. The euro earlier slid to a three-week low against the dollar after figures showed Greece's economy shrank more than expected in the second quarter, while eurozone industrial production unexpectedly declined in June.
Separate data showed the number of Americans filing new claims for unemployment insurance unexpectedly rose in the latest week to its highest in nearly six months, the latest sign of a flagging US economic recovery. The US and eurozone data followed a gloomier outlook from the Federal Reserve and weak Chinese data earlier this week, underscoring worries about the global economy and prompting investors to dump risky assets.
"It seems like the negative correlation between bad news and the US dollar is back," said Brendan McGrath, manager of business solutions at Custom House, a Western Union company, in Victoria, British Columbia. The ICE Futures US dollar index, which measures the greenback versus a basket of major currencies, rose 0.3 percent to 82.58, after hitting a session peak of 82.786, its highest since late July.
The greenback had come under heavy selling pressure since early June as investors increasingly focused on deteriorating economic conditions in the United States. But the currency has rebounded sharply this week on a growing view that if the US economy is slowing materially, it is not alone.
The euro fell as low as $1.2782, according to Reuters data. It was last up 0.1 percent at $1.2827 as US stocks came off their worst levels. Some traders also noted buying by Asian central banks and a Swiss private bank. The single euro zone currency tumbled 2.6 percent on Wednesday, its biggest one-day loss since October 2008.
The dollar rose 0.7 percent to 85.84 yen after rising as high as 86.03, according to Reuters data. It fell to a 15-year low on Wednesday at 84.72 on electronic trading platform EBS, fuelled by a narrowing spread between US and Japanese government bond yields.
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