Dollar holds near one-week high

The dollar held near a one-week high against major rivals on Tuesday after the biggest drop in U.S. jobless claims in nearly a year eased fears of an impending economic slowdown.

The yuan rose after a stronger-than-expected reading on Chinese inflation and the official exchange rate held steady.

The greenback held steady against the yen after a three-day rally supported by higher U.S. Treasury yields after stronger-than-expected jobs data on Thursday slashed bets on a Federal Reserve rate cut this year.

The safe-haven yen and Swiss franc held near one-week lows as Asian stocks benefited from a rally on Wall Street, while more economically sensitive currencies such as the Australian dollar and the British pound remained higher.

The dollar was down 0.1% against the yen at 147.08 yen by 0450 GMT, on track for a gain of about 0.4% this week despite a sharp 1.5% drop on Monday.

The dollar also fell 0.1% against the Swiss franc to 0.8659 francs, on track for a weekly gain of 1%.

The dollar index, which tracks the greenback against the yen, the Swiss franc, the euro, the pound and two other currencies, fell 0.1% to 103.17, snapping a three-day winning streak. It rose to 103.54 late on Tuesday for the first time since Aug. 2, but was last down to a level not far from a week ago.

The euro was little changed at $1.0921, up 0.1% on the week. It had risen to $1.1009 for the first time since Jan. 2 on Monday.

Sterling was steady at $1.2756, after rising 0.49% overnight, recovering from a more than one-month low. However, the pound remained on track to fall 0.4% this week, extending its losing streak to a fourth straight week.

The Australian dollar was steady at $0.6595, having earlier touched $0.6604 for the first time since July 24, with further support from the Reserve Bank of Australia’s hawkish comments the previous day. The Aussie has risen 1.24% this week.

The New Zealand dollar hit a three-week high of $0.6035 before last trading at $0.6026, up 0.2% on the day.