The dollar index (DXY00) Thursday rose by +0.29%. The dollar on Thursday recovered from a 3-week low and posted moderate gains on weakness in the euro and British pound. The euro fell to a 4-week low on dovish ECB comments, and the British pound fell to a 3-1/2 week low after the BOE cut interest rates. The dollar added to its gains Thursday after the equity market sold off, which boosted liquidity demand for the dollar.
Gains in the dollar were contained due to Fed-friendly US economic reports on weekly initial unemployment claims, Q2 nonfarm productivity, and the Jul ISM manufacturing index that knocked the 10-year T-note down to a 6-month low and bolstered Fed rate cut hopes. The dollar also has a negative carryover from Wednesday when Fed Chair Powell said a Fed rate cut "could be" on the table at the September FOMC meeting.
