* Euro on track for worst day vs dollar in 3 weeks
* Greek CDS up, bond yield spreads widen
* U.S. jobless claims increase; capital inflows rise
(Adds quotes, update prices, changes byline)
By Gertrude Chavez-Dreyfuss
NEW YORK, April 15 (Reuters) - The euro fell against the dollar on Thursday, snapping five straight days of gains, on worries over how potential aid for Greece would be disbursed.
The single euro zone currency was on track for its biggest one-day fall in three weeks versus the greenback as the cost of insuring against a Greek default rose and the Greek/German government bond yield spread widened to near record levels.
Although European officials agreed on Sunday to make available 30 billion euros in loans and a further 15 billion coming from the International Monetary Fund, there are questions on how the rescue package would be implemented.
"There was all this talk from the capitals in Europe saying they have to pass legislation first in order to get the loans going," said Richard Franulovich, senior currency strategist, at WestPac in New York. "Then Germany is saying Greece needs to approach it before it can pass legislation. That has caused a bit of consternation and concern."
In early afternoon trading, the euro EUR=> fell 0.6 percent to $1.3564, not far from session lows at $1.3520 its lowest in about a week, according to Reuters data. At current prices, it was on track for the biggest daily percentage decline since March 24.
Greece said on Thursday it is seeking talks with the EU, the European Central Bank, and the IMF on a multi-year economic program that could be backed by financial aid if the Greek government were to seek such assistance. ID:nATH005370
That failed to soothe the market as five-year Greek credit default swap prices rose to 455 basis points, exceeding a record closing high of 444 basis points hit a week ago.
"The real issue for Greece is access to liquidity," said David Pierce, director of business development at GPS Capital Market in Salt Lake City, Utah.
"The fear is that nobody will be willing to loan anything. Greece has almost 12 billion euros worth of bonds maturing over the next 45 days and no money to pay the bill, which would require them to go back to the market and raise money."
Sentiment towards the euro also deteriorated as the cost of insuring against a Portuguese default hit its highest since February after the European Commission on Wednesday said the country may need additional fiscal cuts this year.
Weighing on global sovereign debt markets is the risk other euro zone countries like Portugal or Spain suffer financing problems like those of Greece.
Some in the market said selling by Middle Eastern names also was helping push the euro lower against the dollar, and a break through stop-loss orders around $1.3575 and below had accelerated the currency's fall.
The euro EURJPY=> also dropped 0.8 percent to 126.20 yen, after earlier slipping more than 1 percent to 125.84 yen.
The ICE Futures' U.S. dollar index .DXY>, which tracks the greenback versus a basket of major currencies, rose 0.4 percent to 80.521, recovering from a four-week low of 80.031 hit on Wednesday.
The dollar found support after the Treasury Department said foreign purchases of U.S. securities rose in February as strong private sector demand helped reverse an overall capital outflow suffered during the prior month. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a graphic on foreign holders of U.S. Treasuries, click http://link.reuters.com/teb67j ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
The greenback recovered from earlier losses triggered after strong Chinese growth data ramped up speculation of a yuan revaluation, which is seen as negative for the dollar against Asian currencies. ID:nBJL002018
Against the yen, the dollar was off 0.2 percent at 93.03 yen JPY=>, briefly dipping after a report showed U.S. initial jobless claims unexpectedly soared last week. ID:nN15325702
Separate data on Thursday showed a gauge of manufacturing in New York State rose to a six-month high in April, while U.S. industrial output rose less than expected in March. (Additional reporting by Wanfeng Zhou; Editing by Andrew Hay)