Early on Thursday in European trading, the U.S. dollar held steady close to a six-month high, supported by signals of a strong U.S. economy.

Data released on Wednesday revealed that the U.S. service industry's activity increased more than anticipated in August, and a measure of sector pricing also increased.

The figures spiked worries that inflation would stay high in the near future, leading the Federal Reserve to maintain its hawkish perspective.

The U.S. labor market is projected to continue strong, as seen by the anticipated increase in initial jobless claims from 228,000 to 235,000 later in the session.

The dollar index that gauges the greenback versus its major pairs advanced by 0.1% to 104.897, up from its previous high of just shy of 105, which occurred in mid-March.

EUR/USD slipped 0.1% to 1.0719, German industrial production decreased by 0.8% in July compared to the prior month, more than the 0.5% decline that was anticipated, underscoring the difficulties encountered by manufacturing in Europe's largest economy. This was the country's lowest level since June.

GBP/USD dropped 0.1% to 1.2502, not far off the three-month low reached in the previous session after statistics from Halifax, the UK's largest lender, revealed that property prices in the country decreased 4.6% annually in August.

JPY/USD edged down by 0.1% to 147.50, as BOJ officials' repeated statements that the bank will likely keep its ultra-dovish stance in the foreseeable future, the yen is close to a 10-month low.