The dollar extended its monthly lows before finding support Thursday afternoon, as traders sought a safe haven after U.S. data showed the weakest new home sales on record.
Stocks turned lower as risk aversion picked up. Markets were keeping a close eye on Europe, where Greece continued to haggle with its creditors over a voluntary restructuring of its debt.
Greek newspaper Ethnos reported that private lenders will voluntarily agree to a coupon rate of 3.75 percent on Greek bonds in a debt swap.
The dollar fought back to $1.31 against the euro after hitting $1.3183 -- its lowest since December 21.
The buck also dropped to a 5-week low versus the sterling, touching $1.5730 before improving to $1.5690.
After easing below par for the first time in more than a month versus Canada's loonie, the dollar was clinging to C$1.00 in afternoon trading.
The dollar was hammered yesterday after the Federal Reserve extended its timetable for raising interest rates to late-2014
German Chancellor Angela Merkel was making the rounds at the World Economic Forum in Davos, urging fellow leaders to adopt serious reforms as a means to solve the region's sovereign debt crisis.
She called for greater fiscal unity, saying that Europe should become even "more European."
New home sales in the U.S. unexpectedly fell in the month of December, according to figures released Thursday by the Commerce Department.
Sales of new single-family homes came in at a seasonally adjusted annual rate of 307,000 for the month, a 2.2 percent dip from the revised November rate of 314,000. The November rate had initially been pegged at 315,000.
First-time claims for U.S. unemployment benefits increased by a little more than expected in the week ended January 21st, according to a report released by the Labor Department on Thursday, with jobless claims rebounding from the previous week's nearly four-year low.
The report said jobless claims rose to 377,000 from the previous week's revised figure of 356,000. Economists had expected jobless claims to increase to 370,000 from the 352,000 originally reported for the previous week.
New orders for U.S. durable goods increased by more than anticipated in the month of December, according to figures released Thursday by the Commerce Department.
Durable goods orders came in at $214.5 billion in December, representing a 3 percent increase over November's figures.
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Forex News
June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.