Investing.com - The dollar rose against a basket of major currencies on Thursday, mounting a recovery from its slump in the previous session, following President Trump’s comments the currency was “getting too strong” while mostly upbeat economic data lifted sentiment.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.32% to 100.38 by 17:41 EDT.
The dollar suffered its biggest one-day slump in more than three weeks on Wednesday, after President Trump told the Wall Street Journal, he thinks the currency (dollar) is “getting too strong” and favored a low interest rate environment.
But the dollar mounted a recovery on Thursday, as investors seemed to cover short positions, ahead of the Good Friday holiday in the U.S. and Europe this week.
Trump’s comments modestly dampened expectations of a June rate hike, according to investing.com’s fed rate monitor tool, the probability of a June rate hike eased to 49.5% from 52.8%, a day earlier.
Meanwhile, slower than expected growth in initial jobless claims and bullish consumer sentiment lifted sentiment while US producer prices dropped for the first time in seven months.
The Labor Department said on Thursday, initial jobless claims fell by 1,000 to a 234,000 for the week ended April 8 while the producer price index for final demand slipped 0.1% last month.
The University of Michigan said its consumer sentiment index climbed to 98.0 in April, well above expectations of a fall to 96.5.
Elsewhere, the 'flight to safety' trade eased, as the dollar turned positive against the yen, after USD/JPY added 0.15% to trade at 109.19.
GBP/USD fell by 0.12% to $1.2523 while the USD/CAD added 0.17% to $1.3272.
EUR/USD traded at $1.0625, down 0.38%, while EUR/GBP lost 0.24% to 0.8487.