2023.03.3017:03:00UTC+00U.S. Dollar Down Amid Disappointing Economic Data

The U.S. dollar fell against its most major counterparts in the New York session on Thursday, as the economy grew slightly less than previously estimated in the fourth quarter and weekly jobless claims increased moderately last week, supporting expectations that the Federal Reserve may pause interest rate hikes at the meeting in May.

Data from the Commerce Department showed that real gross domestic product shot up by 2.6 percent in the fourth quarter compared to the previously reported 2.7 percent jump. Economists had expected the pace of growth to be unrevised.

Data from the Labor Department showed that initial jobless claims rose to 198,000, an increase of 7,000 from the previous week's unrevised level of 191,000. Economists had expected jobless claims to inch up to 196,000.

CME Group's FedWatch Tool currently indicates a 48.2 percent chance the Fed will leave rates unchanged at its next meeting in early May and a 51.8 percent chance of a 25 basis point increase.

The dollar index that tracks the greenback against a basket of other currencies fell to a 1-week low of 102.07.

The greenback touched 1.3524 against the loonie, its lowest level since February 23. The pair had closed Wednesday's deals at 1.3558. The greenback is likely to face support around the 1.33 region, if it falls again.

The greenback weakened to 1-week lows of 0.9125 against the franc and 1.0926 against the euro, from yesterday's closing values of 0.9184 and 1.0843, respectively. The greenback is seen finding support around 0.89 against the franc and 1.12 against the euro.

The greenback edged down to 0.6259 against the kiwi, from a 2-day high of 0.6203 hit at 9:30 pm ET. At yesterday's trading close, the pair was quoted at 0.6223. Next key support for the greenback is likely seen around the 0.61 level.

The greenback depreciated to near a 2-month low of 1.2384 against the pound, from a 2-day high of 1.2293 seen at 9:00 pm ET. At yesterday's close, the pair was valued at 1.2311. Should the greenback falls further, it is likely to test support around the 1.27 region.

In contrast, the greenback was up against the yen, at an 8-day high of 132.96. The pair was worth 132.85 when it ended deals on Wednesday. The greenback is likely to find resistance around the 139.00 level.

The greenback rebounded to 0.6687 against the aussie, from a 1-week low of 0.6718 it touched at 4:05 am ET. The greenback may locate resistance around the 0.64 level.