Investing.com - The dollar took back earlier losses sustained against most major currencies on Wednesday after investors felt the U.S. currency fell too far on soft U.S. retail sales data.
In U.S. trading on Wednesday, EUR/USD was unchanged at 1.3369.
The dollar headed south earlier after the Commerce Department reported that U.S. retail sales came in flat last month, disappointing market expectations for a 0.2% increase.
Core retail sales, which exclude auto sales, rose just 0.1% in July, below expectations for a 0.4% gain.
The numbers softened the dollar by reminding investors that the Federal Reserve won't rush to raise interest rates after it closes its monthly bond-buying program, which is seen taking place in October.
Bottom fishers chipped away at earlier losses, as investors felt the currency was oversold especially in light of weak U.K. and European data.
Eurostat, the European Union's statistical office, reported earlier that industrial output in the euro area contracted 0.3% in June. It was the second consecutive monthly decline and confounded expectations for a 0.3% expansion.
The report came one day after data showed that German economic sentiment deteriorated sharply this month, falling to a 20 month low, largely due to geopolitical tensions.
The pound, meanwhile, came under broad pressure after the Bank of England cut its forecast for wage growth to 1.25% from 2.5% in 2014, before picking up to 3.25% in 2015.
The bank reiterated that when rates do start to rise they will do so a “small, slow” manner.
Separately, the Office of National Statistics reported that average earnings, excluding bonuses, rose by just 0.6% in the three months to June, missing market calls for a 0.07% ratings.
Including bonuses, pay packets contracted by 0.2% during the quarter, the first decrease since 2009 and more than consensus forecasts for a 0.1% contraction.
Elsewhere, the U.K. unemployment rate fell to 6.4% in the quarter, in line with expectations and down from 6.5% in May.
The number of people claiming unemployment benefits fell by 33,600 last month, beating expectations for a decline of 30,000. June’s figure was revised to a drop of 39,500 from 36,300 previously.
The greenback was up against the pound, with GBP/USD down 0.73% at 1.6689.
The dollar was up against the yen, with USD/JPY up 0.18% at 102.45, and down against the Swiss franc, with USD/CHF down 0.04% at 0.9072.
The dollar was down against its cousins in Canada, Australia and New Zealand, with USD/CAD down 0.08% at 1.0915, AUD/USD up 0.40% at 0.9305 and NZD/USD up 0.27% at 0.8456.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.11% at 81.65.
On Thursday, the U.S. is to release its weekly report on initial jobless claims.