The U.S. dollar recovered Thursday, with the Dollar Index ticking up to 98.980. This rebound follows a turbulent start to the week sparked by Federal Reserve Chair Jerome Powell's claims of intimidation by the Trump administration. Traders have since absorbed the political noise, looking instead to stronger U.S. economic signals.

Supporting the greenback's advance, recent data showed U.S. retail sales and producer prices increased more than expected in November. The Fed's Beige Book further calmed markets, reporting flat-to-higher activity across most districts with no labor market deterioration. Consequently, markets have pushed back expectations for rate cuts, now pricing a first move for June at the earliest.

In Europe, the euro slipped 0.1% against the dollar to 1.1633 following tense talks between U.S. and Danish officials regarding Greenland's future. Conversely, sterling edged higher to 1.3440 after U.K. growth data beat forecasts, expanding 0.3% in November. Analysts suggest the pound's correction may continue, especially with upcoming inflation data looming.