Coffee prices rose on Thursday, as the US dollar held against most currencies, amid renewed concerns over the Brazilian supply.

The Brazilian Public Food Commissariat reported that there were frost waves that affected 150,000 to 200,000 hectares, or about 11% of the country's coffee-grown areas in the country.

Coffee traders said that this is the first time since 1994 that Brazil has experienced such bad weather, which foreshadows several other upcoming frost waves.

The total traded coffee options contracts during July were at a record of 664,648.

The dollar index fell against a basket of major currencies by less than 0.1% to 92.9 points as of 13:24 GMT, after hitting a high of 93.01 points and a low of 92.8 points.

As of 13:30 GMT, coffee spot prices rose 0.6% to $1.85 a pound.

The major US stock indices fell in early trading on Thursday, after the release of economic data.

The US Department of Labor revealed that the number of initial unemployment claims fell to 375K last week.

The US producer price index rose by 1% in July, beating forecasts 0.6%.

The core reading (excluding food and fuel prices) rose by 1%, higher than forecasts of 0.5%.

As for stocks, Dow Jones fell 0.1% or 65 points to 35,416 as of 13:55 GMT, and S&P 500 rose fell 0.1% or 8 points to 4,439, while Nasdaq fell 0.1% or 42 points to 14,722.

The US dollar fell against a majority of rivals on Thursday, deepening its losses for the second straight day, on profit-taking from from a 4-month high, after data showed a slowdown in the US inflation rate during July, which reduced the inflationary pressures on the US Federal Reserve to start tightening monetary policy in the near term.

The dollar index fell 0.1% to 92.84 points, after opening at 92.90 points, and hit a low of 92.94 points.

The US dollar fell 0.2% yesterday, on profit-taking from from a 4-month high of 93.20 points.

Data showed yesterday a slowdown in the US inflation rate during July, which reduced the inflationary pressures on the US Federal Reserve to start tightening monetary policy in the near term.

At 12:30 GMT, the US producer price index reading will be released, which is expected up 0.6% in July, slowing down from 1% in June, while core prices are expected up 0.5%, slowing down from 1%. 

US unemployment claims are expected down 10K to 375K in the week ending August 6, from 385K in the previous week.

Gold prices rose on Thursday, to continue recovery from a 5-month low for the second straight day, as the US dollar fell against its peers, after data showed a slowdown in the US inflation rate.

Gold prices rose 0.4% to $1,758.13 an ounce, after opening at $1,751.27, and hit a high at $1,748.90.

Gold closed higher by 1.3% yesterday, the first gain in 5 days, in recovery from a 5-month low of $1,683.67 an ounce.

The dollar index fell 0.1% today, to head for the the second straight loss against a majority of rivals, and pulled back from a 4-month low of 93.19 points which lifts demand for dollar-denominated metal prices. 

The greenback is falling due to disappointing data, which showed a slowdown in the US inflation rate during July.

The data reduced the inflationary pressures on the US Federal Reserve, and increased the odds of the central bank to start tightening monetary policy in the near term.

Gold stocks at the SPDR ETF remained unchanged yesterday, with the total at the lowest level since May 5 at 1,023.54 metric tonnes.