The U.S. dollar continued to lower against its major rivals in early European deals on Thursday, as the Federal Reserve kept its interest rates steady and hinted at a gradual pace of rate hike in the coming months.

Even though the Fed upgraded its assessment on economic performance, it gave little clues about a near-term rate hike.

"The committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run," the Fed said in a statement.

"However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data," it added.

Investors also focus on the Bank of Japan's latest monetary policy decision ending tomorrow amid expectation that it won't deliver radical stimulus.

The greenback has been trading in a negative territory in Asian deals.

Continuing early slide, the greenback slid to a 2-day low of 104.48 against the Japanese yen. If the greenback-yen pair extends slide, 102.00 is possibly seen as its next support level.

The greenback declined to a 6-day low of 1.3111 against the loonie, reversing from its early high of 1.3188. The greenback is seen finding support around the 1.30 zone.

The greenback slid to a 9-day low of 0.9828 against the franc and near a 2-week low of 1.1117 against the euro, from its early highs of 0.9867 and 1.1052, respectively. The greenback is likely to find support around 0.97 against the franc and 1.125 against the euro.

Retreating from an early high of 1.3166 against the pound, the greenback fell back to 1.3217.The greenback is thus heading to pierce its early 6-day low of 1.3248. Extension of the greenback's downtrend may see it finding support around the 1.34 area.

Data from the Nationwide Building Society showed that U.K. house prices increased more than expected in July after Britons voted to leave the European Union.

Annual growth in house prices increased to a 4-month high of 5.2 percent in July from 5.1 percent in June, while it was expected to ease to 4.5 percent.

The greenback weakened to a 10-day low of 0.7121 against the kiwi and held steady thereafter. On the downside, the greenback may challenge support around the 0.72 level.

The greenback reversed from its Asian session's high of 0.7487 against the aussie, edging down to 0.7549. Continuation of the greenback's downtrend may see it challenging support around the 0.78 mark.

Data from the Australian Bureau of Statistics showed that export prices in Australia rose 1.4 percent on quarter in the second quarter of 2016.

That was shy of forecasts for 3.0 percent following the 4.7 percent contraction in the previous three months.

Looking ahead, Eurozone economic confidence index for July is due shortly.

At 8:00 am ET, German flash consumer prices for July are set for release.

U.S. weekly jobless claims for the week ended July 23 and advance goods trade data for June will be out in the New York session.

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