The dollar slumped to one-month lows against a basket of major currencies on Thursday after the minutes of the Federal Reserve’s March meeting indicated that rates are likely to remain on hold for some time.
USD/JPY was last down 0.60% to 101.35, the lowest since March 19.
The Fed’s March meeting minutes released on Wednesday showed that policymakers discussed whether to keep interest rates at record lows until inflation moves higher, and did not elaborate on a possible timeframe for when rates could start to rise.
The minutes also indicated growing concerns among officials over persistently low inflation.
The greenback shrugged off data showing that the number of people who filed for unemployment assistance in the U.S. last week dropped to an almost seven year low.
The Labor Department reported that the number of individuals filing for initial jobless benefits in the week ending April 4 fell by 30,000 to a seasonally adjusted 300,000, the lowest since May 2007, from the previous week’s upwardly revised total of 332,000.
Analysts had expected jobless claims to decline to 320,000.
Elsewhere, EUR/USD rose to one month highs of 1.3898.
In the euro zone, Greece made a successful return to the financial markets on Thursday, raising €3 billion in its first bond auction since 2010, when Athens sought its first bailout.
Sterling rose to four-and-a-half year peaks of 1.6820 against the dollar and GBP/USD was last trading at 1.6785. The Bank of England left the benchmark interest rate unchanged at 0.50% earlier Thursday, in a widely anticipated move.
The dollar slid to three-week lows against the Swiss franc, with USD/CHF down 0.42% to 0.8758.
The Australian dollar was trading close to four-and-half month highs, with AUD/USD advancing 0.37% to 0.9424. The Aussie was boosted after official data on Thursday showed that the number of employed people in Australia rose by 18,100 in March, exceeding expectations for a 5,000 rise.
Australia's unemployment rate ticked down to 5.8% last month, from 6.1% in February.
NZD/USD was trading not far from two-and-a-half year highs at 0.8709, while USD/CAD rose 0.25% to trade at 1.0909 as the U.S. jobless claims report lent support.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, dropped 0.24% to 79.41, the lowest since March 13.