The US dollar weakened in early European session trading amid market uncertainty ahead of next week's FOMC policy meeting.
Surprise decisions by the Bank of Canada (BOC) and the Reserve Bank of Australia (RBA) have shaken investors' expectations that the Federal Reserve (Fed) will stop raising interest rates.
This was reflected in higher global bond yields, particularly the US 10-year yield which surged to its strongest level in over a week at 3.79%.
Looking ahead, investors will be exposed to the publication of US jobless claims data in the New York session.
In the Asian session tomorrow (Friday), China's inflation data for May will be released which will definitely be a driving force for the risk-sensitive currencies of the Aussie and New Zealand dollars.
The Aussie dollar remained firmly traded in the European session, following the RBA's continued hawkish decision to raise interest rates, while the New Zealand dollar was flat.
Meanwhile, the euro and pound each recorded a moderate increase compared to the declining greenback dollar.
Additionally, the Canadian dollar strengthened to its strongest level in four weeks following the BOC's decision to raise interest rates by 25 basis points to 4.75%.
The yen, on the other hand, stabilized from the previous fall, supported by Japan's gross domestic product (GDP) data which grew 2.7% in the first quarter, exceeding expectations for growth of just 1.9%.
On the other hand, the Turkish Lira continued to extend its decline to an all-time low against the US dollar.
