By Deborah Levine & William L. Watts, MarketWatch
NEW YORK (MarketWatch) -- The dollar, aided by waning appetite for risky assets, gained back some ground on other currencies Thursday, a day after sinking to a fresh 14-month low against the euro.
The dollar index (DXY 75.35, +0.37, +0.50%) , a measure of the U.S. currency against a trade-weighted basket of rivals, stood at 75.310, up from 74.983 in North American activity late Wednesday, when it hit a fresh 14-month low.
The euro traded at $1.4991, sliding from $1.5040. On Wednesday, it breached the psychologically important $1.50 level for the first time since August 2008. Read more about the euro's rise.
The dollar also traded at 91.47 Japanese yen, compared to 91.03 yen on Wednesday.
Thursday's foreign-exchange trading keyed on pressure on equities that started in Asia, after China reported an 8.9% rise in third-quarter gross domestic product. That prompted many to voice concerns that the nation would withdraw some of its stimulus programs. Read more about China's economic data.
"Talk China may cut back stimulus now that the Chinese economy is picking up steam may have provided an excuse for some profit taking on risk-on trades," noted strategists at Brown Brothers Harriman.
Benchmarks tracking the European equity markets also declined, down more than 1%. The enabled the dollar, which has tended to move in the opposite direction, to regain some ground. Read Europe Markets.
On Wall Street, stocks quickly turned higher amid a deluge of reports on corporate earnings.
In commodities, crude-oil and gold futures were also lower. Their prices tend to move inversely to the dollar.
The greenback clung to gains after the Labor Department earlier said initial claims for jobless benefits rose 11,000 to 531,000 in the week ended Oct. 17. The median estimate of economists surveyed by MarketWatch was for claims to total 510,000. See more on jobless claims.
Still on tap on the data front are an index on leading economic indicators for September as well as a home-price gauge for August, due at 10 a.m. Eastern time.
Debating the dollar
The debate over the weak dollar remains a key theme in currency markets, wrote strategists at UniCredit MIB in Milan.
Worries that European officials may step up efforts to talk down the single currency after the break above the $1.50 level could slow the currency's rise, "but buying on dips is favored ahead of the $1.52 target," they wrote.
A reversal would come only with a move below $1.4850, they said.
From a technical standpoint, the euro isn't overbought despite the recent rally, and bullish momentum remains "fairly strong," wrote Nicole Elliott, technical analyst at Mizuho Corporate Bank, in a research note.
Meanwhile, the Swedish krona lost ground against the euro.
The Swedish Riksbank, the nation's central bank, on Thursday left its key lending rate unchanged at 0.25%, as expected, and said it continued to expect the rate to remain at that level until the third quarter of next year.
The bank also decided to provide an additional 100 kronor ($14.6 billion) in fixed-term, 11-month loans to commercial banks, saying that additional measures were needed to help hold down interest rates and to ensure that an accommodative monetary policy is effective.
