Investing.com – The dollar fell against a basket of major currencies as weakness in the labor market offset data showing the U.S. economy grew faster-than-expected in the second quarter.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.29% to 93.00.
Gross domestic product increased at a 3.1% annual rate in the April-June period, the Commerce Department said in its third estimate on Thursday, beating a previous estimate of 3%.
Fresh on the heels of the upbeat economic growth data, a labor market report showed the number of Americans filing for unemployment benefits rose more than expected last week.
The U.S. Department of Labor reported Thursday that initial jobless claims increased 12,000 to a seasonally adjusted 272,000 for the week ended Sept. 23, missing forecasts of a 10,000 increase.
The slump in the dollar comes after it hit one-month highs on renewed hopes for tax reform in the wake of the President Donald Trump’s speech on Wednesday in which the president hailed a tax reform plan released by his administration as a "once-in-a-generation opportunity".
The duo of reports came just hours ahead of speeches by Fed officials Stanley Fischer and Esther George as the latter said continued interest rate increases are the best way to ensure the current economic recovery remains on track.
“Further gradual adjustment in short-term interest rates based on an economy growing above trend ... will be important if we want to continue this long expansion,” George said.
Sterling and the euro were the main beneficiaries of a dip in the greenback, as the latter rose for the first time in three days, paring recent losses.
EUR/USD rose to 0.32% to $1.1785 while GBP/USD rose 0.43% to $1.3441.
USD/JPY fell 0.35% to Y112.46 while USD/CAD fell 0.30% to C$1.2439.