Investing.com - The dollar edged higher against the other major currencies on Friday, as expectations for additional stimulus measures in the euro zone and Japan supported the greenback, while investors eyed upcoming U.S. data due later in the day.
EUR/USD slid 0.32% to 1.0840.
The euro remained under pressure after European Central Bank President Mario Draghi said on Thursday that it would be necessary to “review and reconsider” the bank’s monetary policy stance at its next meeting in March, when new economic projections become available.
Adding to those comments on Friday morning, Draghi said the bank has “plenty of instruments” to reach price stability in the euro area and that it has “the determination, the willingness and the capacity of the Governing Council to act and deploy these instruments.”
Earlier Friday, research group Markit said its preliminary German manufacturing purchasing managers’ index ticked down to 52.1 in January from 53.2 the previous month. Germany’s services PMI fell to 55.4 from 56.0.
The French manufacturing PMI slipped to 50.0 this month from 51.4 in December, while the services PMI rose to 50.6 from 49.8.
For the entire euro zone, the composite PMI, which includes manufacturing and service sector activity, ticked down to 53.5 in January from 54.3 in December.
USD/JPY climbed 0.42% to 118.19.
Sentiment on the yen was vulnerable after Bank of Japan Governor Haruhiko Kuroda said on Thursday that he is not thinking of adopting a negative interest rate policy now, signalling that any further monetary easing will likely take the form of an expansion of its current asset-buying program.
Elsewhere, the dollar was lower against the pound, with GBP/USD up 0.27% at 1.4259, off Thursday’s seven-year lows of 1.4078, and was higher against the Swiss franc, with USD/CHF adding 0.25 to 1.0098.
The U.K. Office for National Statistics reported on Friday that retail sales declined by 1.0% in December, confounding expectations for a 0.3% slip. Year-on-year, retail sales rose 2.6% last month, disappointing expectations for a 4.3% gain.
Core retail sales, which exclude auto sales and fuel, fell 0.9% in December, compared to expectations for a 0.3% downtick.
A separate report showed that U.K. public sector net borrowing rose by £6.87 billion in December, less than the expected increase of £10.35 billion.
Meanwhile, the Canadian dollar remained under pressure after oil prices fell below 28$ once again Thursday, but they regained some strength on Friday morning. USD/CAD was down 0.60% at a one-and-a-half week low of 1.4182, pulling away from Wednesday’s 13-year peak of 1.4692.
The Australian dollar was higher, with AUD/USD up 0.33% at 0.7023, while NZD/USD dropped 0.38% to trade at 0.6505.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.17% at 99.31, still close to Thursday’s one-and-a-half month highs of 99.89.