1st LD Writethru: U.S. dollar weakens on soft retail sales

The U.S. dollar stopped its rally against most major currencies on Thursday as the country's retail sales number came out negative.

Retail trade sales for February were down 0.6 percent from January, missing market expectations of a 0.3-percent gain, said the U.S. Commerce Department on Thursday.

A surprise drop in retail sales eased concerns that the Federal Reserve may raise interest rates in mid-year. The dollar index, which measures the greenback against six major peers, was down 0. 65 percent at 99.142 in late trading.

Fed officials will gather next week in a policy meeting at which it is expected to give more clues about the timing of the first rate increase in almost a decade.

Meanwhile, in the week ending March 7, the advance figure for seasonally adjusted initial U.S. jobless claims was 289,000, down 36,000 from the previous week's revised level, said the U.S. Labor Department Thursday.

In late New York trading, the euro climbed to 1.0603 dollars from 1.0535 dollars in the previous session, and the British pound dropped to 1.4854 dollars from 1.4934 dollars. The Australian dollar rose to 0.7685 dollars from 0.7578 dollars.

The U.S. dollar bought 121.36 Japanese yen, lower than 121.51 yen of the previous session. The U.S. dollar edged down to 1.0058 Swiss francs from 1.0102 Swiss francs, and it slipped to 1.2710 Canadian dollars from 1.2762 Canadian dollars. Endite