By Gertrude Chavez-Dreyfuss
NEW YORK, June 27 (Reuters) -The U.S. dollar fell against most currencies on Thursday, pressured by weak data from the world’s largest economy, which supported expectations that the Federal Reserve will begin to cut interest rates this year.
* The yen recovered from a 38-year low against the dollar after the US figures, although traders remained alert for any signs of Japanese intervention to shore up the currency.
* Applications for state unemployment benefits fell by 6,000 to 233,000 in the week ended June 22. However, the number of people receiving benefits after an initial week of aid rose by 18,000 to 1.839 million in the week ended June 15.
* New orders for U.S. manufactured capital goods fell unexpectedly in May, suggesting business spending on equipment weakened in the second quarter.
* Other data showed economic growth moderated sharply in the first quarter. Gross domestic product rose at a slightly upwardly revised annualized rate of 1.4% last quarter, but less than the 3.4% rate in the final three months of 2023.
* The GDP report also showed weak consumer spending, at 1.5%, revised down from the previous estimate of 2%.
* “It seems that the markets are focusing more on personal consumption than anything else, which would definitely be a sign of a slowdown in the US economy,” said Helen Given, currency trader at Monex USA in Washington.
* The yen rose slightly to 160.765 per dollar, after falling to 160.88 on Wednesday, its lowest level since 1986.
* The Japanese currency has lost 2% this month and 12% this year against the greenback, as it continues to be hit by the marked interest rate differences between the United States and Japan.
* Among other currencies, the pound rose 0.2% to $1.2643, the euro gained 0.2% to $1.0704
* The dollar index fell 0.1%, to 105.91 units, not far from the almost two-month high reached on Wednesday, of 106.13 units.
(Additional reporting by Rae Wee and Ankur Banerjee; editing by Carlos Serrano)
