Investing.com - The dollar was steady against the other major currencies as investors awaited monetary policy announcements by the European Central Bank and the Bank of England later in the day, as well as a report on U.S. private sector job creation.
EUR/USD was trading at 1.3147, holding above the one year low of 1.3109 set on Tuesday.
The euro found some support after data on Thursday showed that German factory orders rebounded 4.6% in July, easily outstripping forecasts for a 1.5% rise.
The upbeat data indicated that the euro zone’s largest economy could be recovering from weakness seen earlier in the year.
Sentiment on the single currency remained fragile ahead of the ECB’s monetary policy announcement later Thursday.
The euro has been hit by growing expectations that the ECB will announce quantitative easing measures as a way to stave off deflation after the annual rate of euro area inflation slowed to a five year low last month.
The dollar was little changed against the yen, with USD/JPY at 104.85, holding below Wednesday’s eight month highs of 105.30. Meanwhile USD/CHF was trading at 0.9178.
Demand for the greenback continued to be underpinned by expectations that the Federal Reserve is growing closer to raising interest rates as recent upbeat economic reports indicated that the U.S. recovery is deepening.
Investors were looking ahead to the latest U.S. employment report, due for release on Friday, for further indications on the strength of the recovery in the labor market, a key factor in deciding the future path of monetary policy.
The U.S. was to release reports on ADP nonfarm payrolls and initial jobless claims later Thursday.
The pound was close to its lowest level in seven months, with GBP/USD at 1.6457, not far from Wednesday’s lows of 1.6438.
The BoE was widely expected to leave rates on hold on Thursday, even though the monetary policy committee was split seven to two in favor of a rate hike last month.
However, sterling remained under pressure after amid concerns that support for Scottish independence is gaining momentum ahead of a referendum due to take place on September 18.
AUD/USD was supported close to one week highs at 0.9348 after data on Thursday showed that Australia’s trade balance narrowed more than expected in August and other report showing an increase in retail sales in July.
NZD/USD was steady at 0.8328, while USD/CAD was at 1.0888.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was flat at 82.88, not far from Wednesday’s 13-mont highs of 83.08.