Meanwhile, the dollar saw added support after Federal Reserve Chairman Ben Bernanke told Congress that monetary authorities will begin tapering stimulus programs later this year provided the economy continues to improve.
Stimulus programs such as the Fed's monthly USD85 billion bond-buying program weaken the dollar to spur recovery, and talk of their dismantling often bolsters the greenback.
In U.S. trading on Thursday, EUR/USD was down 0.31% at 1.3084, up from a session low of 1.3071 and off from a high of 1.3128.
The pair was likely to find support at 1.2994, Monday's low, and resistance at 1.3177, Wednesday's high.
The U.S. Department of Labor reported earlier that the number of individuals filing for initial jobless benefits last week fell by 24,000 to 334,000, compared to expectations for a drop of 13,000 to 345,000, which sent the dollar rising.
Elsewhere, the Federal Reserve Bank of Philadelphia said that its manufacturing index rose 19.8 for July from June’s 12.5 reading. Analysts had expected the index to decline to 7.8.
Meanwhile, Fed Chairman Bernanke told U.S. lawmakers in his semi-annual congressional testimony that stimulus programs will remain in place for the foreseeable future though they may begin to wind down later this year when the economy improves.
Bernanke also stressed that an end to stimulus programs does not herald the arrival to a tightening of monetary policy, adding that benchmark lending rates may remain at rock-bottom levels even if the unemployment rate approaches 6.5%, a level the U.S. central bank has said it would like to see.
The euro, meanwhile, was down against the pound and up against the yen, with EUR/GBP trading down 0.21% at 0.8609 and EUR/JPY trading up 0.69% at 131.57.
On Friday in the euro zone, Germany is to release official data on producer price inflation.
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