WASHINGTON (dpa-AFX) - The U.S. dollar turned in a sluggish performance on Friday with investors assessing the Federal Reserve's likely moves with regard to interest rate reductions in the wake of most recent economic data, and Fed Chair Jerome Powell's somewhat hawkish comments.
Powell said the U.S. central bank does not need to rush to lower interest rates and can approach decisions carefully, given persistent inflationary pressures.
He lauded the economy as 'remarkably good', the labor market as 'solid' and noted that inflation was 'running much closer' to the bank's target.
In economic news, the Commerce Department said retail sales rose by 0.4% in October after growing by an upwardly revised 0.8% in September. Economists had expected retail sales to climb by 0.3% compared to the 0.4% increase originally reported for the previous month.
The Labor Department also released a report showing an unexpected 0.3% increase by import prices in the U.S. in the month of October, which may added to recent worries about sticky inflation.
Meanwhile, the Fed released a report showing industrial production decreased in October, falling by 0.3%, as the effects of recent hurricanes and the since-resolved strike at Boeing (BA) continued to weigh on growth.
The dollar index, which dropped to 106.33 in the European session, climbed to 106.96 around mid morning, and despite a subsequent setback, recovered to 106.78, netting a marginal gain.
Against the Euro, the dollar firmed up slightly to 1.0525, and strengthened to 1.2606 against Pound Sterling.
The dollar weakened against the Japanese currency, dropping to 154.37 yen a unit, down 1.22% from Thursday's close. Against the Aussie, the dollar edged down marginally to 0.6455.
The Swiss franc strengthened to 0.8884 a unit of the U.S. currency, while the Loonie weakened to 1.4091.
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