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Dollar regains ground on U.S. data but Fed still weighs

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Shutterstock photo - - The dollar regained some ground against a basket of other major currencies on Thursday, supported by data showing that U.S. jobless claims fell unexpectedly last week, but the minutes of the Federal Reserve's latest policy meeting continued to weigh on the greenback.

The US Dollar Index, which tracks the performance of the greenback against a basket of six major currencies, was steady at 85.37, below the four-year peak of 86.87 hit last Friday.

In a report, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending October 4 decreased by 1,000 to 287,000 from the previous week's revised total of 288,000.

Analysts had expected jobless claims to rise by 6,000 to 294,000 last week.

The dollar weakened broadly after the minutes of the Fed's September 16-17 policy on Wednesday showed that a number of officials believe the bank's current language painted the wrong picture on the timing of rate hikes and that an interest rate rise should be tied to U.S. economic progress.

The minutes also showed that the U.S. central bank cut its growth outlook due to the higher dollar and concerns over global weakness.

USD/JPY remained near three week lows of 107.53 hit earlier in the session, before pulling back slightly to trade a 107.88, down 0.16% for the day.

Government data on Thursday showed that Japan's core machinery orders rose 4.7% in August, more than the expected 1.1% increase, after a 3.5% gain in July.

EUR/USD pulled away from a more than two-week high of 1.2791 to slip 0.10% at 1.2722.

The pound and the Swiss franc also lost some ground, with GBP/USD up only 0.07% to trade at 1.6178 and USD/CHF steady at 0.9513.

In a widely expected move, the Bank of England voted to keep interest rates on hold at 0.5% and to keep the size of its asset purchase program unchanged at £375 billion.

The minutes of the meeting, due to be published in two weeks, would indicate how many monetary policy committee members voted in favor of a rate hike. The MPC was split in September for the second consecutive month, with two members voting in favor of a rate increase and two against.

The commodity linked dollars were mixed, with AUD/USD little changed at 0.8840, NZD/USD up 0.19% to trade at 0.7923 and USD/CAD steady at 1.1116.

Earlier in the day, official data showed that the number of employed people in Australia fell by 29,700 last month, confounding expectations for a 17,600 increase, while the unemployment rate ticked up to 6.1% in September from 6.0% in August. offers an extensive set of professional tools for the financial markets.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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