U.S. Dollar extended gains Thursday recording a series of inclines versus major currencies during European session after Fed’s Bank meeting signaled it would slow the pace of bond purchases later this year as the U.S. economy, particularly its labor market, are recovering.

In a press conference following The Federal Open Market Committee monetary decision, Fed’s Chairman Ben Bernanke said the central bank may reduce the pace of stimulus modestly later in 2013, and may end the purchases around mid-2014.

The greenback extended gains on Thursday, where the USDIX is currently trading around 82.16 after opening at 81.56, having so far hit a high of 82.22 and a low of 81.45.

As for dollar-dominated commodity, gold prices extended the selloff into Thursday morning with the kick-start of the European session as investors digested Bernanke’s comments where he signaled Fed’s plans to scale back its $85 billion in bonds per month.

Losses extended with Gold striking fresh session lows, reaching 1288.56 the lowest in nearly two years, after opening at $1,350.40, having earlier hit a high of $1,351.10, and a low of $1,286.01.

The EURUSD pair dropped to the lowest in a week, pressured by dollar rally despite positive Purchasing Manager’s Index (PMI) data released earlier in the session by Germany and the euro area.

Eurozone composite of manufacturing and services showed a contraction for a 17th month in June, however, contraction eased on significant rise in services. PMI composite soared to 48.9 this month from 47.7 a month earlier as manufacturing sector`s contraction narrowed to 48.7 from the prior of 48.3 while services improved to 48.6 from 47.2.

The EURUSD pair recorded low of 1.3180, after recording a high of 1.3301. The pair is currently hovering around 1.3186.

The pound is losing steam, falling for a third day versus the dollar and pushing the GBPUSD lower to trade around $1.5441, while recording the highest level of $1.5492 and lowest of $1.5414.

Meanwhile, United Kingdom retail sales advanced in May, exceeding analysts` forecast, giving further signs the economy is on the right track towards recovery.

The Swiss franc fell against the dollar as U.S. Federal Reserve hawkishness and trade balance data took their toll on risk appetite, buoying safe haven units and sending the single currency lower.

The Swiss National Bank reaffirmed its commitment to defend its lid on the safe-haven currency at its June monetary policy assessment. The Zurich-based central bank maintained the franc ceiling at 1.20 franc per euro.

The central bank decided to keep the 3-month libor target rate at record low of zero to 0.25 percent in June, in an attempt to support the economy and limit the downside risks of stronger Swiss Franc.

The dollar rose against its Swiss counterpart following the decision where the USDCHF hit a session high of 0.93599 and a low of 0.92498. The pair is currently holding around 0.93445 compared with the day`s opening of 0.92780.

INSEE said on Thursday that Italy’s current account fell to 854 million euros in April from 1.917 billion euros in March.

Asian stocks received a double blow on Thursday, falling the most in almost two years, after the U.S. Federal Reserve Chairman Ben Bernanke hinted that asset-purchases could end later this year if the economy continues to improve while China’s PMI disappointed.

- MSCI Asia Pacific Index fell 3.6% to 128.29 as of 15:28 in Tokyo, heading for its biggest loss since September 2011

Bernanke said yesterday that the Federal Reserve will maintain its bond-buying program for now and start reducing bond purchases later this year and end them in mid 2014 if the economy continue to improve and unemployment will decline at the pace the Fed expect.

- Nikkei 225 closed 1.74% lower at 13014.58

- Topix closed 1.33% lower at 1091.81

In Australia stocks also fell as the appetite for risk declined in reaction to the Fed’s intension to end the $85 billion bon-buying-program next year, while China’s weak data hurts domestic exporters like miners as China is Sydney`s largest trading partner.

- The S&P/ASX 200 closed 2.12% lower at 4758.39

- New Zealand’s NZX 50 closed 1.06% lower at 4398.52

In China, the preliminary manufacturing PMI released by HSBC showed activity in the sector will be the lowest since Sep. if confirmed on July 1 when the final reading is released, while 7-day bond repurchase rate jumped to a record high of 12%.

- China’s CSI 300 Index closed 3.30% lower at 2321.47

- Hong Kong’s Hang Seng closed 2.88% lower at 20382.87

In South Korea, the weaker yen, which is seen trading above the 98-mark, weighed on major exporters such as techs and chemicals. Samsung falling 2.5% and LG falling 3% left a heavy weight on the market.

- Kospi closed 0.65% lower at 1888.31

German PMI manufacturing contraction widened in June to 48.7 from a prior of 49.4, coming below expectations of 49.9.

The services gauge, on the other hand, showed an expansion of 51.3 from a previous of 49.7, exceeding analysts’ forecast of 50.0.