The US dollar fell against most major currencies on Thursday, hurt by weaker-than-expected US economic data that affirmed expectations the Federal Reserve will hold interest rates this year. The greenback so far this week has fallen 0.4 percent, after gaining more than 1 percent the previous week, highlighting an uneven performance amid a mixed batch of US economic reports. The US data came a day after minutes of the Fed's monetary policy last month said patience was needed when it came to tightening rates, noting a pause in rate hikes gave it time to observe the effects of past increases amid a global economic slowdown.

New orders for key US-made capital goods, in particular, unexpectedly fell in December, data showed on Thursday, amid declining demand for machinery and primary metals, pointing to sluggish business spending on equipment that could crimp economic growth. "Overall, the durable goods data provide further reason to think that economic growth will soon slow to below its 2 percent potential pace, which will keep the Fed on hold throughout this year," said Andrew Hunter, senior US economist, at Capital Economics in London.

Thursday's data also showed that Philadelphia Fed's manufacturing activity index dropped to a reading of -4.1 this month from 17.0 in January. That was the first negative reading since May 2016. In mid-morning trading, the dollar fell 0.2 percent against the yen to 110.63 yen, sliding for the first time in five days. The euro also inched higher versus the dollar, up 0.1 percent at $1.1343.

Copyright Reuters, 2019