EUR/USD
The euro erased gains against the U.S. dollar on Friday, despite tepid U.S. economic reports as earlier data from the eurozone failed to boost confidence in the bloc's economic recovery. In a revised report, the University of Michigan said its consumer sentiment index ticked down to 98.1 in January from 98.2 the previous month. Analysts had expected the index to remain unchanged this month. The UoM also said its inflation expectations for the next 12 months rose to 2.5% this month from 2.4% in December. A separate report showed that the Chicago purchasing managers' index rose to 59.4 this month from 58.8 in December, whose figure was revised up from a previously estimated reading of 58.3. Analysts had expected the index to fall to 57.5 in January.
GBP/USD
The pound held steady against the U.S. dollar on Friday, after the release of mixed U.K. economic reports and as markets eyed the release of U.S. economic growth data due later in the day. In a report, the Bank of England said that net lending to individuals fell to £2.2 billion in December from £3.1 billion in November, whose figure was revised down from a previously estimated £3.3 billion. Analysts had expected net lending to individuals to hit £3.2 billion last month. Data also showed that U.K. mortgage approvals rose by 60,280 last month after a downwardly revised 58,960 increase in November. Analysts had expected the number of new mortgage approvals to rise by 59,000 in December. The reports came after data published earlier Friday showed that the U.K. Gfk consumer confidence index improved to 1 this month from minus 4 in December, compared to expectations for a reading of minus 2.
USD/JPY
The dollar slid lower against the safe-haven yen on Friday, following the release of disappointing U.S. fourth quarter economic growth data. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, ended the week at 95.00, down 0.01% for the day and 0.33% lower on the week. The dollar had strengthened broadly on Thursday after the Federal Reserve indicated that interest rates could start to rise around mid-year. Following its policy meeting on Wednesday, the Fed said it would keep rates on hold at least until June and reiterated its pledge to be patient on raising interest rates, while acknowledging the solid economic recovery and strong growth in the labor market.