The dollar was little changed to slightly lower against most other currencies on Friday, with investors mostly inclined to take on riskier assets on a day devoid of major US economic data. The greenback so far this week has fallen 0.3 percent, after gaining more than 1 percent the previous week, in an uneven performance amid mixed US economic data.
"We continue to believe that longer run headwinds for the US dollar are rising - in the form of structural (deficits) and secular (trend) pressures," said Shaun Osborne, chief FX strategist at Scotiabank in Toronto. "We also believe that the US dollar is increasingly vulnerable in the shorter run to negative seasonal pressures - which typically see the dollar peak in March and generally trade lower through until Q3," he added.
Investors continue to watch high-level talks between US and Chinese trade negotiators in Washington. Just over a week is left before higher tariffs would be triggered by the expiration of a US-imposed deadline for an agreement. With the economic outlook foggy and major central banks much more accommodative than a few months ago, US-China trade talks and Brexit are the primary concerns for traders.
In mid-morning trading, the dollar index was flat at 96.618. The euro dipped on Friday. Weak data since January has undermined support for the single currency, which edged lower against the dollar to $1.1331 It hit a two-week high on Wednesday, helped by hopes for an easing of the US-China trade conflict.
The Australian dollar, on the other hand, rebounded after China denied that it had banned imports of the country's coal. Reuters reported on Thursday that the Chinese port of Dalian had barred imports of Australian coal indefinitely, pushing the Aussie dollar down 1 percent China said on Friday, however, that imports would continue, but customs has stepped up checks on foreign cargoes. The Aussie dollar was last up 0.6 percent at US$0.7130.
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