The dollar is slightly weaker against its major competitors Thursday, following the release of some disappointing economic reports. Weekly jobless claims increased more than expected, while housing starts declined more than expected.
With energy prices showing a substantial decrease, the Labor Department released a report on Thursday showing that U.S. consumer prices fell by slightly more than expected in the month of April.
The Labor Department said its consumer price index fell by 0.4 percent in April following a 0.2 percent drop in March. Economists had expected prices to decrease by about 0.3 percent.
While the Commerce Department released a report on Thursday showing that U.S. housing starts fell by much more than anticipated in the month of April, the report also showed a substantial increase in building permits.
The Commerce Department said housing starts tumbled 16.5 percent to a seasonally adjusted annual rate of 853,000 in April from the revised March estimate of 1.021 million.
Economists had expected housing starts to drop to an annual rate of 969,000 from the 1.036 million originally reported for the previous month.
On the other hand, the Commerce Department said building permits, an indicator of future housing demand, jumped 14.3 percent to an annual rate of 1.017 million in April from the revised March rate of 890,000.
Following a recent downward trend, first-time claims for U.S. unemployment benefits rebounded by much more than anticipated in the week ended May 11th, according to a report released by the Labor Department on Thursday.
The report said initial jobless claims rose to 360,000, an increase of 32,000 from the previous week's revised figure of 328,000. Economists had expected claims to climb to 330,000 from the 323,000 originally reported for the previous week.
Manufacturing firms responding to the Federal Reserve Bank of Philadelphia's monthly Business Outlook Survey unexpectedly indicated that regional manufacturing activity has contracted in the month of May.
A report released by the Philly Fed on Thursday showed that its diffusion index of current activity fell to a negative 5.2 in May from a positive 1.3 in April, with a negative reading indicating a contraction in regional manufacturing activity.
The decrease by the Philly Fed index came as a surprise to economists, who had expected the index to climb to a positive reading of 2.2.
The International Monetary Fund on Wednesday approved a three-year loan worth EUR 1 billion to Cyprus as part of the EUR 10 billion international bailout package aimed at stabilizing the country's ailing banking sector.
The approval of the latest loan tranche allows immediate disbursement of EUR 86 million to the euro member.
While applauding Cyprus' efforts to address the crisis, IMF Managing Director Christine Lagarde said that the country faced "significant" challenges, including restoring credibility in the banking sector and reducing fiscal deficits and debt to sustainable levels.
The continuing recession and the recent relapse in business confidence suggest that the Eurozone economy is in serious danger of suffering further modest contraction in the second quarter, IHS Global Insight Chief European and UK Economist Howard Archer said.
The firm expects the Eurozone economy to contract 0.7 percent this year, with very gradual recovery only starting in the latter months of the year.
The ongoing recession is likely to reinforce pressure on the European Central Bank to introduce further measures to try to support economic growth, and there is possibility of an interest rate cut to 0.25 percent in the near term.
The dollar reached an early high of $1.2845 against the Euro on Thursday, but has since pulled back to around $1.2900.
Eurozone exports grew for the third consecutive month in March giving a ray of hope that the region can emerge out of the recession that has now extended to a record six quarters.
Exports increased at a pace of 2.8 percent in March from the previous month, when it grew only 0.2 percent, data published by Eurostat showed Thursday.
Meanwhile, reflecting the weak domestic demand, imports fell 1 percent after easing 2.2 percent.
A faster growth in exports accompanied by a fall in imports doubled the trade surplus in March. The trade surplus totaled EUR 22.9 billion, up from EUR 10.1 billion in February.
Eurozone inflation slowed as initially estimated to 1.2 percent in April from 1.7 percent in March, final data from Eurostat showed Thursday. Month-on-month, prices were down 0.1 percent.
The buck rose to an early high of $1.5197 against the pound sterling Thursday, but has since eased back to around $1.5300.
The greenback climbed to a high of Y102.675 against the Japanese Yen on Thursday, but has since retreated to around Y102.100.
Japan's gross domestic product expanded 0.9 percent in the first quarter of 2013 compared to the previous three months, the Cabinet Office said in Thursday's preliminary report. The headline figure beat forecasts for an increase of 0.7 percent following the flat reading in the previous three months. Q4's reading barely broke a string of three straight quarters in the red.
Japan's industrial producer increased in March at a faster rate than estimated earlier, final data released by the Ministry of Trade and Industry showed Thursday. Industrial production gained a seasonally adjusted 0.9 percent month-on-month in March, faster than the 0.2 percent recorded in the initial estimates. The growth rate was also higher than 0.6 percent seen in February.
For comments and feedback contact: editorial@rttnews.com
Market Analysis
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.