The euro rose against the dollar on Friday, coming off earlier lows after data showed that U.S. inflation expectations fell in an otherwise upbeat report on consumer confidence. EUR/USD was up 0.40% to 1.2526 in late trade, after falling to lows of 1.2399 earlier in the session. For the week, the pair gained 0.54%.In the euro zone, data on Friday showed that the economy expanded 0.2% in the three months to September and grew 0.6% from the same period a year earlier. Germany avoided a recession, posting growth of 0.1% in the last quarter, while France grew by a slightly stronger than expected 0.3%. Greece exited a six-year recession, but Italy fell back into recession, posting a contraction of 0.1%.
The pound fell to fresh 14-month lows against the dollar on Friday, after the Bank of England said inflation was likely to slow further, prompting investors to delay expectations for a U.K. rate hike until late next year. GBP/USD fell to lows of 1.5594, the weakest since September 2013, before pulling back to 1.5671 in late trade, off 0.25% for the day. The pair ended the week with losses of 1.32%.Sterling remained broadly weaker after the BoE said in its closely watched quarterly inflation report on Wednesday that inflation is likely remain below its 2% target in the near term and fall below 1% at some point during the next six months.
The U.S. dollar hit fresh seven-year highs against the yen on Friday after upbeat data on U.S. retail sales boosted the outlook for the economic recovery. USD/JPY rose to 116.82, the most since October 2007, before pulling back to 116.28 in late trade, up 0.44% for the day. For the week, the pair advanced 1.53%. The greenback trimmed gains after separate data showed that U.S. inflation expectations fell in an otherwise upbeat report on consumer confidence for this month. However, the report also showed that consumers expected annual inflation of 2.6% this year, down from expectations for inflation of 2.9% in October.
