Investing.com - The euro gained some ground against the U.S. dollar on Friday, after the release of positive euro zone inflation data and as the Federal Reserve’s inaction at its latest policy meeting continued to dampen demand for the greenback.
EUR/USD 1.1103 during late European morning trade, the session high; the pair subsequently consolidated at 1.1096, up 0.17%.
The pair was likely to find support at 1.1046, Thursday’s low and resistance at 1.1150, the high of July 15.
In a preliminary report, Eurostat said on Friday that the euro zone’s consumer price index rose at an annualized rate of 0.2% in July, exceeding expectations for a 0.1% uptick and after a 0.1% gain the previous month.
Core CPI, which excludes food, energy, alcohol and tobacco, increased by 0.9% last month, year-on-year, in line with expectations.
Meanwhile, the dollar remained under pressure after the Fed left interest rates unchanged at the conclusion of its two-day policy meeting on Wednesday, in a widely expected move.
In its monthly policy statement, the Fed said that “near-term risks to the economic outlook have diminished” and that the labor market has “strengthened”.
Market participants were now eyeing the release of second quarter U.S. economic growth data, due later Friday for further indications on the strength of the economy.
The euro was also higher against the pound, with EUR/GBP adding 0.13% to 0.8426.
Also Friday, the Bank of England reported that net lending to individuals rose to £5.2 billion in June from £4.5 billion in May, whose figure was upwardly revised from a previously estimated £4.3 billion.
Analysts had expected net lending to individuals to rise to hit £4.2 billion last month.
But the pound’s gains were capped as investors turned to the BoE’s policy meeting next week amid growing expectations for a rate cut.
The Financial Times reported on Tuesday that Martin Weale, a member of the BOE's rate-setting committee, dropped his opposition to an easing and now favored immediate stimulus.