2019.08.2216:55:00UTC+00Dollar Stays Weak As Traders Look For Direction

Save for a brief while early in the day, the U.S. dollar stayed weak on Thursday as traders looked ahead for clues about stimulus or interest rate cuts from the Federal Reserve at the symposium in Jackson Hole, Wyoming on Friday.

With the minutes of the Federal Reserve's late July meeting, which was released on Wednesday, failing to provide any clear hint about future interest rate cuts, the focus has now shifted to the upcoming speech of Fed chief Jerome Powell in Jackson Hole.

The dollar index dropped to a low of 98.08 around mid morning, and despite recovering to 98.20 later on, was still down in negative territory, trailing its previous close by about 0.1%.

Against the euro, the dollar was down marginally at 1.1084, after having recovered from a low of 1.1114.

Against British Pound Sterling, the dollar weakened to 1.2254, losing more than 1%, with the British currency rallying sharply against most major rivals after German Chancellor Angela Merkel remarked that she has not set a 30-day deadline for the U.K. to find a solution to the Irish "backstop."

The sterling was also supported by comments from French President Emmanuel Macron, who said the Withdrawal Agreement can be amended to allow the UK to leave the European Union with a deal.

The comments by Macron have added to the view that there is a willingness by the EU to talk to the UK on the matter of the Brexit deal that could ultimately prevent a 'no deal' Brexit occurring on October 31.

Against the Yen, the dollar was down 0.18% at 106.43 yen, after moving between 106.26 and 106.65 in the session.

Among other currencies, the Aussie was down more than 0.3% against the greenback with the pair trading at 0.6757.

The loonie was down marginally at $1.3300, while the USD-CHF pair was up 0.18% at 0.9837.

In economic news, data released by the Labor Department said first-time claims for U.S. unemployment benefits fell by much more than expected in the week ended August 17, dropping by 12,000 to 209,000.

Economists had expected jobless claims to dip to 216,000 from the 220,000 originally reported for the previous week.

A separate report released by the Conference Board showed its reading on leading U.S. economic indicators rose by a much more than anticipated 0.5% in the month of July. The index edged down by 0.1% in both May and June.

Traders also looked ahead to the Group of Seven summit this weekend for clues on what additional steps policymakers may take to boost growth.