Investing.com - The Aussie held weaker on Friday after retail sales came in below expectations and the central bank cuts its 2017 views on GDP growth.
AUD/USD traded at 0.7191, down 0.08%, while USD/JPY changed hands at 116.91, up 0.11%.
Fourth quarter retail sales rose 0.6%, below the 0.9% gain seen.
"December’s weaker than expected retail sales figures suggest that Australian retailers had a disappointing Christmas period and that consumer spending has lost some momentum," Capital Economics said in a note to clients.
"The gains in both October and November were revised down too. The cooling housing market may have started to hit sales, with household goods falling by 1.0% m/m after rising rapidly in the previous four months. The disappointing results were also driven by a 0.5% m/m fall in spending at cafes, which was weaker than the 0.8% m/m rise in November. There were a few bright spots, with the 0.8% m/m rise in food sales building on decent growth in recent months."
As well, the Reserve Bank of Australia lowered its estimates of GDP in the coming year, but kept inflation views unchanged in its latest monetary policy statement released on Friday.
The statement noted continued concerns about the health of China's economy, including for the statrt dates of major liquified natural gas projects aimed at exports.
The statement comes after a Feb. 2 decision to hold interest rates steady at a record low 2%, while noting there is scope to ease furtehr if warranted.
Earlier in Australia, the AIG Construction index fell to 46.3 in January from 46.8 the previous month.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last quoted at 96.51, down 0.76%.
Investors were looking ahead to Friday’s U.S. nonfarm payrolls report for January for fresh indications on the strength of the labor market.
Data on Thursday showed that initial jobless claims rose by a larger-than-forecast 8,000 to 285,000 last week, but remained in territory usually associated with a firming labor market.
Overnight, the dollar extended losses against a basket of the other major currencies Thursday as the greenback remained under pressure amid uncertainty over how much the Federal Reserve will be able to raise interest rates this year.
The dollar fell sharply on Wednesday after weak U.S. service sector data and dovish Fed comments prompted investors to trim back expectations on the timing of further rate hikes.
The Institute of Supply Management reported that activity in the U.S. services sector slowed to a near two-year low in January.
New York Fed President William Dudley said the weakening outlook for the global economy and any further strengthening of the dollar could have "significant consequences" for the health of the U.S. economy.