2023.12.2120:42:00UTC+00Dollar Slips Against Major Counterparts As Weak Data Raises Rate Cut Bets

The U.S. dollar shed ground against its major rivals on Thursday after data showing a drop in economic growth and an uptick in jobless claims raised prospects of a rate cut by the Federal Reserve early next year.

Data released by the Commerce Department showed the real gross domestic product jumped by 4.9% in the third quarter, reflecting a downward revision from the previously reported 5.2% increase. Economists had expected the pace of GDP growth to be unrevised.

A report from the Labor Department showed jobless claims in the U.S. crept up to 205,000 in the week ended December 16, an increase of 2,000 from a week earlier.

Jobless claims were expected to rise to 215,000 from the 202,000 originally reported for the previous week.

Meanwhile, a report from the Federal Reserve Bank of Philadelphia showed regional manufacturing activity contracted at an accelerated pace in the month of December.

The focus now is on the U.S core personal consumption expenditure (PCE) index data due on Friday.

The dollar index dropped to 101.79, losing about 0.6%.

The dollar weakened to 1.1007 against the Euro from 1.0943, and eased to 1.2686 from 1.2639 against Pound Sterling.

Against the Japanese currency, the dollar was down at 142.24 yen, giving up nearly 1%. The greenback is weak against Swiss franc, fetching CHF 0.8563 a unit, compared with CHF 0.8629 on Wednesday. Against the Loonie, the dollar is down against the loonie at C$ 1.3283.