Investing.com - The dollar strengthened broadly against a basket of other major currencies on Friday, as it recovered from the previous session's mixed U.S. data and as markets eyed upcoming U.S. economic reports due later in the day.
On Thursday, the Department of Labor said the number of Americans filing claims for initial jobless benefits in the week ending May 9 fell by 1,000 to 264,000, coming in just above the 15 year low reached two weeks ago, indicating that the recovery in the labor market is continuing.
But the data was overshadowed by another report showing that the U.S. producer price index fell 0.4% last month and was 1.3% lower on a year-over-year basis, the largest drop since 2010.
The weak inflation data reinforced expectations that the Federal Reserve will hold off on raising interest rates until the economic recovery is on a stronger footing.
Investors were now looking ahead to reports on U.S. industrial production, manufacturing activity in the New York region and consumer sentiment, due later in the day, for further indications on the strength of the economy.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.45% to 93.82, off Thursday's four-month lows of 93.16.
EUR/USD slid 0.48% to 1.1353, pulling away from Thursday's three-month highs of 1.1444.
Sentiment on the single currency remained vulnerable as Greek officials were set to hold talks with the euro area and the International Monetary Fund on Friday, amid mounting pressure for Athens to seal an agreement for aid as it runs out of cash reserves and time.
The pound pulled back from Thursday's six-month peak of 1.5816, with GBP/USD down 0.26% to 1.5735.
Elsewhere, the dollar was higher against the yen and the Swiss franc, with USD/JPY advancing 0.44% to 119.68 and with USD/CHF climbing 0.65% to 0.9181.
In Switzerland, the Federal Statistical Office earlier reported that the producer price index fell 2.1% in March, compared to expectations for a downtick of 0.1%, after a 0.2% rise the previous month.
Year-on-year, producer prices dropped 5.2% in March, after a 3.4% decline in February.
The Australian and New Zealand dollars were weaker, with AUD/USD down 0.79% to 0.8017 and NZD/USD declining 0.76% to 0.7442.
Meanwhile, USD/CAD rose 0.23% to trade at 1.2013 after hitting four-month lows of 1.1920 in the previous session.