Investing.com - The dollar was trading close to three-week highs against the broadly weaker euro on Thursday after official data showed that that the recession in the euro zone deepened in the fourth quarter, with economic growth contracting more-than-expected.
During European afternoon trade, the dollar rallied against the euro, with EUR/USD dropping 0.91% to 1.3330.
The euro came under broad selling pressure after official data showed that euro zone gross domestic product contracted by 0.6% in the three months to December, compared to expectations for a 0.4% decline, after a 0.1% contraction in the third quarter.
It was the fastest rate of decline since 2009 and marked a third consecutive quarter of contraction.
Germany’s economy, the euro zone’s largest, contracted by 0.6% in the in the fourth quarter, more than expectations for a 0.5% drop on declining exports and investment.
Elsewhere, the dollar was little changed against the yen, with USD/JPY dipping 0.06% to 93.34.
The Bank of Japan kept monetary policy unchanged on Thursday, in a widely expected decision.
The BoJ refrained from expanding its stimulus program following its policy setting meeting, as investors looked ahead to a meeting of finance ministers from the G20 later in the week, amid concerns that Japan could come under pressure following the recent steep decline in the yen.
Earlier Thursday, official data showed that Japan’s economy contracted by 0.1% in the fourth quarter, compared to expectations for an uptick of 0.1%.
The greenback was trading close to six-month highs against the pound, with GBP/USD slipping 0.17% to 1.5513.
The pound remained under pressure after the Bank of England cut its outlook for growth on Wednesday and said inflation would remain above target until early 2016.
Elsewhere, the greenback was higher against the Swiss franc, with USD/CHF rising 0.55% to 0.9219.
The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.03% to 1.0013, AUD/USD down 0.25% to 1.0343 and NZD/USD up 0.38% to 0.8483.
The New Zealand dollar rose to almost 18-month highs against the greenback in the Asian session after a report by Business New Zealand said that its index of manufacturing activity jumped to a seven month high of 55.2 in January, up from 50.4 in December.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.57% to 80.63.
Market participants were looking ahead to U.S. government data on initial jobless claims later in the day.
During European afternoon trade, the dollar rallied against the euro, with EUR/USD dropping 0.91% to 1.3330.
The euro came under broad selling pressure after official data showed that euro zone gross domestic product contracted by 0.6% in the three months to December, compared to expectations for a 0.4% decline, after a 0.1% contraction in the third quarter.
It was the fastest rate of decline since 2009 and marked a third consecutive quarter of contraction.
Germany’s economy, the euro zone’s largest, contracted by 0.6% in the in the fourth quarter, more than expectations for a 0.5% drop on declining exports and investment.
Elsewhere, the dollar was little changed against the yen, with USD/JPY dipping 0.06% to 93.34.
The Bank of Japan kept monetary policy unchanged on Thursday, in a widely expected decision.
The BoJ refrained from expanding its stimulus program following its policy setting meeting, as investors looked ahead to a meeting of finance ministers from the G20 later in the week, amid concerns that Japan could come under pressure following the recent steep decline in the yen.
Earlier Thursday, official data showed that Japan’s economy contracted by 0.1% in the fourth quarter, compared to expectations for an uptick of 0.1%.
The greenback was trading close to six-month highs against the pound, with GBP/USD slipping 0.17% to 1.5513.
The pound remained under pressure after the Bank of England cut its outlook for growth on Wednesday and said inflation would remain above target until early 2016.
Elsewhere, the greenback was higher against the Swiss franc, with USD/CHF rising 0.55% to 0.9219.
The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.03% to 1.0013, AUD/USD down 0.25% to 1.0343 and NZD/USD up 0.38% to 0.8483.
The New Zealand dollar rose to almost 18-month highs against the greenback in the Asian session after a report by Business New Zealand said that its index of manufacturing activity jumped to a seven month high of 55.2 in January, up from 50.4 in December.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.57% to 80.63.
Market participants were looking ahead to U.S. government data on initial jobless claims later in the day.