FOREX-Dollar trades in narrow range as four-day euro rally fizzles

* Euro edges lower vs USD
* U.S. weekly jobless claims grind lower but backlogs,
layoffs
linger

(New throughout, updates prices, market activity, comments to
U.S. market open; new byline, changes dateline; previous LONDON)
By Saqib Iqbal Ahmed
NEW YORK, May 21 (Reuters) - The dollar traded in a narrow
range against major peers on Thursday as investors weighed the
impact of the global economic lockdown, and the euro's four-day
rally against the U.S. currency on optimism about a closer
fiscal union in Europe ran out of steam.
The U.S. Dollar Currency Index =USD , which measures the
greenback's strength against six major currencies, was up 0.1%
at 99.27.
Data on Thursday showed millions more Americans filed for
unemployment benefits last week as backlogs continue to be
cleared and disruptions from the novel coronavirus unleash a
second wave of layoffs, pointing to another month of staggering
job losses in May. The greenback, which draws investors in times of economic
uncertainty, has fallen back since hitting a more than
three-year high in March as central bank interventions have
eased international dollar shortage and investors have
gravitated toward risky assets.
"The USD has dropped to the lower end of the trading range
that has been in place for some weeks as markets assess the
global economic lock down," said Shaun Osborne Chief FX
strategist at Scotia Bank.
"We think scope for additional losses is likely limited
unless some fresh fundamental dynamic emerges to drive trading."
Speculators' net bearish bets on the U.S. dollar shrank to
the smallest position in seven weeks in the latest week.
euro was supported in recent sessions by France and
Germany's recent proposal for a 500-billion-euro ($543 billion)
recovery fund to offer grants to regions and sectors hit hardest
by the coronavirus pandemic. The euro 0.09% lower on the day at $1.09695, after a gain of
about 1.6% over the last fours sessions.
The pound was about flat on the day against the dollar but
remains under pressure as weak inflation drives speculation the
Bank of England may cut interest rates below zero. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
GRAPHIC: FX positions https://tmsnrt.rs/3bJyfVj
GRAPHIC: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
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