Dollar mixed on strong economic data
Greenback gains versus yen but slips against euro and pound as better-than-expected data suggest economic recovery.
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NEW YORK (CNNMoney.com) -- The dollar was mixed against major rivals on Thursday following better-than-expected economic data about inflation and jobless claims.
The dollar surged 1.32% against the yen to ¥90.60, but slid against the euro and the pound to $1.4932 and $1.6260, respectively.
"Even though equities turned sour [earlier] today, strong economic data fueled the recovery story and risk appetite in the U.S. and drove the dollar lower against high yielding currencies," said Kathy Lien, director of currency research at Global Forex Trading. "Whenever you factor in risk appetite, investors take money out of lower currencies." Equities advanced in the afternoon and finished high, with the Dow closing above 10,000 for a second day in a row.
The government released a tame inflation report on Thursday, which showed that although the Consumer Price Index is down, the core CPI, which excludes food and energy prices, edged slightly higher than expected.
The Labor Department's report on initial jobless claim showed a surprise drop in the number of U.S. workers filing new claims for unemployment insurance.
Despite the better-than-expected data, Lien said the dollar will continue to remain under pressure.
"There are more reasons to sell the dollar than buy it, and all of the reasons will hold through the end of the year," Lien said, adding that dollar has been declining because the Federal Reserve has kept interest rates near zero and "it's more and more likely that the Fed will be the last central bank to tighten monetary policy."
Lien added that the dollar fell aggressively last month, and over the last decade, the dollar has continued its September trend 70% of the time in the three months following. 
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