The greenback weakened versus most of the major currencies on Wednesday as better-than-expected economic data in Japan and U.S. added signs for recession may have started to ease. The dollar index (which measures the dollar’s strength against a basket of six other currencies) dropped 0.21 percent to 86.314 in late New York session, while dollar fell to session lows of 97.57, 1.1595, 0.7118 and 0.5623 against the yen, Swiss franc, Australian dollar and New Zealand dollar respectively.

The single currency rose broadly as risk appetite returned on a recovery in European equities and a sharp selloff in sterling in earlier trade also contributed to the demand in euro. The single currency climbed higher and touched session highs of 1.3038, 128.12, 1.5165 and 0.8989 versus the dollar, yen, Swiss franc and British pound respectively before stabilising.

Meanwhile, the British pound tumbled after the U.K. government projected a massive increase in public debt (from $148 bln to $320.5 bln) and announced a tax rise for high earners in its annual budget. The sterling fell sharply to a three-week low of 1.4397 against U.S. dollar and 140.64 versus the yen in New York morning.

On the data front, the Japan Finance Ministry said the export slump slowed in March and reported a 45.6 percent decline from a year earlier, compared with February’s unprecedented 49.4 percent plunge. A separate report in U.S. later in the day showed a sign that low mortgage rates may be bolstering demand as U.S. home prices fell 6.5 percent in February from a year earlier, the second-smallest drop in six months.

On Thursday, economic data releases include Switzerland’s trade balance and ZEW index, German PMI manufacturing and PMI service, eurozone current account, PMI manufacturing, PMI service and industrial orders, U.K. CBI distribution orders, Canada retail sales, and U.S. weekly jobless claims and exiting home sales.