Early trade in New York: Dollar slips, consolidates recent gains

NEW YORK: The dollar fell on Thursday, consolidating recent gains that pushed it to nearly three-year highs during the first quarter, but the outlook remained upbeat in the wake of solid US economic data and accelerated vaccine rollouts.

The US currency gained 3.6% against a basket of six major currencies in the first three months of the year, its best quarterly performance since June 2018, with investors betting on a swift and robust economic recovery.

A report on the US manufacturing sector showed a stronger-than-expected reading of 64.7 in March, the highest in more than 37 years. That was offset, though, by slowing construction spending, which fell 0.8% in February, and an increase in US jobless claims in the latest week.

In midmorning trading, the dollar index slipped 0.1% to 93.077, not far from a five-month high of 93.439 reached on Wednesday.

The dollar slipped a bit after the jobless claims report, with claims of 719,000 in the week ended March 27.

The euro was last up 0.1% at $1.740.

The dollar was flat against the yen at 110.67 yen, after ending March with its biggest monthly gain since November 2016. It rose as high as 110.97 on Wednesday, the highest in a year.

China’s onshore spot yuan finished the domestic session at 6.5739 per dollar, its weakest close since Nov. 30. Data showed China’s factory activity in March expanded at the slowest pace in almost a year.