USDJPY United States Dollar vs Japanese Yen

The U.S. dollar dipped against its most major counterparts in the European session on Thursday, as U.S. consumer inflation grew slightly less than expected in April, dampening hopes for faster rate hikes this year.

Data from the Labor Department showed that the consumer price index rose 0.2 percent in April after edging down by 0.1 percent in March. Economists had expected consumer prices to climb by 0.3 percent.

Excluding food and energy prices, core consumer prices inched up by 0.1 percent in April after rising by 0.2 percent in the previous month. Core prices had been expected to rise by 0.2 percent.

Data from the Labor Department showed that first-time claims for U.S. unemployment benefits unexpectedly came in unchanged in the week ended May 5th.

The report said initial jobless claims came in at 211,000, unchanged from the previous week's unrevised level. Economists had expected jobless claims to rise to 218,000.

The greenback dropped against its key counterparts in the Asian session, barring the yen.

The greenback dropped to a 2-day low of 1.1936 against the euro, from a high of 1.1843 hit at 7:45 pm ET. The greenback is likely to find support around the 1.21 level.

Reversing from an early session's high of 1.0056 against the Swiss franc, the greenback fell to a 3-day low of 0.9995. On the downside, 0.97 is likely seen as the next support for the greenback.

The greenback edged down to 109.32 against the yen, reversing from an 8-day high of 110.02 seen at 3:30 am ET. If the greenback continues its fall, 108.00 is possibly seen as its next support level.

Data from the Ministry of Finance showed that Japan logged a current account surplus of 3.122 trillion yen in March, up 4.2 percent on year.

That beat expectations for a surplus of 2.899 trillion yen following the 2.076 trillion yen surplus in February.

The greenback declined to near a 3-week low of 1.2744 against the loonie and a 3-day low of 0.7533 against the aussie, off its early highs of 1.2862 and 0.7450, respectively. The next possible support for the greenback is seen around 1.26 against the loonie and 0.77 against the aussie.

The greenback eased back to 0.6969 against the kiwi, coming off from a 5-month high of 0.6903 set at 2:00 am ET. The greenback is poised to challenge support around the 0.70 area.

On the flip side, the greenback held steady against the pound, after having advanced to a 2-day high of 1.3490 at 7:30 am ET. This follows a weekly low of 1.3617 set during European deals. At yesterday's close, the pair was worth 1.3545.

The Bank of England decided to keep its key interest rate and quantitative easing unchanged and downgraded its near-term growth outlook.

The Monetary Policy Committee voted 7-2 to maintain the benchmark rate at 0.50 percent. The bank had previously raised its key rate in November 2017, which was the first hike in a decade.

Looking ahead, U.S. monthly budget statement is scheduled for release in the New York session.

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