In late New York trading on Thursday, the euro rose to $1.1202 from $1.1152 dollars of the previous session, and the British pound increased to $1.3275 from $1.3128, Xinhua news agency reported.
The Australian dollar climbed to $0.7554 from $0.7516.
The dollar bought 103.27 Japanese yen, lower than 103.44 yen in the previous session.
The dollar decreased to 0.9796 Swiss francs from 0.9832 Swiss francs, and it inched down to 1.3103 Canadian dollars from 1.3121 Canadian dollars.
The August purchasing managers' index for U.S. manufacturing sector registered 49.4 per cent, a decrease of 3.2 percentage points from the July reading of 52.6 per cent, showing the first contraction in manufacturing since February, said the Institute for Supply Management (ISM) on Thursday.
On other economic front, in the week ending August 27, the advance figure for seasonally adjusted initial jobless claims was 263,000, an increase of 2,000 from the previous week's unrevised level of 261,000, the US Labor Department announced on Thursday.
The US Department of Commerce reported on Thursday that construction spending during July 2016 was estimated at a seasonally adjusted annual rate of $1,153.2 billion, nearly the same as the revised June estimate.
The overall downbeat economic data lowered market expectation for an interest-rate hike soon.
The dollar index, which measures the greenback against six major currencies, was down 0.43 per cent at 95.612 in late trading.
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