The safe-haven dollar was nearly flat Thursday, caught in cross-currents of anxiety about European governments' finances and a pickup in a taste for risky trading as U.S. exports grew and a measure of job losses declined.
For more than a year, the dollar and short-term government debt has tended to trade inversely with stocks, commodities and emerging-market currencies, which investors deem riskier. Better-than-expected corporate and economic data has prompted equity buying and dollar selling. Meanwhile, unsettling events, such as the Dubai debt crisis, have tended to lift the low-yielding dollar due to its safety appeal.
The dollar was nearly flat against the European currencies amid ongoing worries about their governments' finances.
In late Thursday trading in New York, the 16-nation euro edged up to $1.4720 from $1.4714 late Wednesday, while the British pound rose to $1.6264 from $1.6248. The dollar dipped to 1.0504 Swiss francs from 1.0539 francs.
Greece's government promised Wednesday to step up efforts to reduce the deficit after a ratings agency downgraded the country's debt rating because of its enormous budget shortfalls.
Also on Wednesday, Standard & Poor's lowered its credit rating outlook on Spain to negative.
European Union officials were reluctant Thursday to promise help to debt-saddled Greece, saying it was up to Athens to put its economy back on track.
"These ratings announcements highlighted that all is not necessarily well in the eurozone," said Matthew Strauss, senior currency strategist at RBC Capital in Toronto.
Traders are concerned about how the public debt situations will unfold next year, he said, and what effect a Greek debt default would have on the euro.
Meanwhile, the dollar tumbled against currencies of countries that are big commodity exporters. Those currencies tend to do well when investors get tidbits of news that signal a recovering economy _ which would use more commodities.
On Thursday, that came in the form of data on exports and jobs. The government said exports of U.S. goods rose for the sixth month in a row in October, helped by the weaker dollar. That helped narrow the U.S. trade gap and prompted at least one economist to pump up his prediction for American economic growth in the current quarter.
The Labor Department also said Thursday that while the number of newly laid-off workers seeking jobless benefits rose more than expected last week, the four-week average of claims, which smooths out weekly fluctuations, fell to the lowest level since September 2008.
The gradually improving labor market could actually generate jobs early next year, some economists said.
The hope for a better-than-expected economic recovery helped pump up the Australian, New Zealand and Canadian dollars against the greenback.
The Australian dollar rose to 91.70 U.S. cents, the New Zealand dollar climbed to 72.85 U.S. cents from 71.24 U.S. cents, and the greenback dropped to 1.0504 Canadian dollars from 1.0539 late Wednesday.
The dollar also fell against the Brazilian real and Norwegian krone.