Investing.com - The dollar gained ground against the broadly weaker euro on Thursday after European Central Bank President Mario Draghi indicated that the bank could implement fresh easing measures as soon as next month.
The euro fell from more than two-year highs against the dollar, with EUR/USD dropping 0.39% to 1.3856. The pair rose to peaks of 1.3994 earlier, the strongest level since October 2009.
The drop in the euro came after Draghi said the ECB governing council is comfortable with acting at its next meeting, after the bank has published fresh forecasts for inflation and growth.
Draghi said that recent weakness in inflation has been due to food and energy prices, but added that the strong euro and weak domestic demand are also pushing down inflation.
The euro strengthened earlier in the session after the ECB voted to leave interest rates on hold at 0.25%.
Elsewhere, the dollar was lower against the yen, with USD/JPY down 0.27% to 101.62, not far from the three-week trough of 101.42 struck in the previous session.
The dollar remained under pressure after Federal Reserve Chair Janet Yellen said Wednesday that a high degree of monetary accommodation remains warranted given the slack in the economy.
The pound was steady near almost five-year highs against the dollar, with GBP/USD trading at 1.6942, just below Tuesday’s peaks of 1.6993. Demand for the pound continued to be underpinned by expectations that the Bank of England will raise rates at the start of next year.
Sterling showed little reaction after the Bank of England kept interest rates on hold at their current record low of 0.5% earlier Thursday.
Elsewhere, USD/CHF was up 0.26% to 0.8785.
AUD/USD was holding close to three-week highs at 0.9377, boosted by upbeat Chinese trade data and a stronger-than-forecast domestic jobs report for April.
Chinese imports and exports both rose slightly in April from a year earlier data on Thursday showed, confounding forecasts for them to decline. The data eased concerns over a slowdown in the world’s second-largest economy.
A separate report showed that the number of employed people in Australia rose by 14,200 in April, beating expectations for a 6,800 increase, while the unemployment rate remained steady at 5.8%.
NZD/USD slipped 0.14% to 0.8648, and USD/CAD was down 0.33% to 1.0862.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, rose 0.18% to 79.41, pulling back from the six-month trough of 79.09 reached on Tuesday.
In the U.S., the Department of Labor reported that number of people who filed for unemployment assistance last week fell by 26,000 to 319,000 from the previous week’s revised total of 345,000.
Analysts had expected jobless claims to fall by 20,000 to 325,000.