Forexpros - The U.S. dollar hit session lows against the euro on Thursday and was mixed against the other major currencies, as hopes for a deal to avert the U.S. fiscal cliff and a better than expected Italian bond auction bolstered demand for the single currency. During European late morning trade, the dollar was lower against the euro, with EUR/USD rising 0.27% to 1.2987. Market sentiment found support after U.S. President Barack Obama said Wednesday he hoped to reach an agreement with Congress before Christmas to avoid automatic tax hikes and spending cuts due to come into effect on January 1, which could threaten U.S. and global growth. Meanwhile, Italy saw borrowing costs fall sharply at an auction of five and 10-year government bonds on Thursday, with the yield on 10-year bonds down to 4.45%, a two year low and the yield on five-year bonds falling to 3.23%, also a two-year low. Elsewhere in the euro zone, official data showed that the German unemployment rate remained unchanged at 6.9% in November as the number of unemployed people rose by 5,000, better than expectations for an increase of 15,000. The greenback was little changed against the pound, with GBP/USD dipping 0.02% to 1.6009. The Bank of England warned earlier that U.K. banks may not have enough capital put aside to insulate them from future financial market shocks. The greenback was hovering close to multi-month highs against the yen, with USD/JPY edging down 0.01% to 82.08, but was lower against the Swiss franc, with USD/CHF sliding 0.22% to 0.9271. The yen remained under pressure amid expectations that upcoming elections on December 16 will result in growing political pressure on the Bank of Japan to implement more aggressive monetary easing measures. In Switzerland, official data showed that the economy expanded by 0.6% in the third quarter, after a 0.1% contraction in the three months to June. The greenback was mixed against its Canadian, Australian and New Zealand counterparts, with USD/CAD dipping 0.09% to 0.9912, AUD/USD slipping 0.10% to 1.0463 and NZD/USD up 0.33% to 0.8263. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.24% to 80.16. Later in the day, the U.S. was to release preliminary data on third quarter growth as well as the weekly government report on initial jobless claims.

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