CANBERA (dpa-AFX) - The U.S. dollar declined against its key counterparts in the European session on Wednesday, as the nation's retail sales fell for a third month in a row in February, reinforcing hopes for a gradual pace of interest rate hikes this year.
Data from the Commerce Department showed that retail sales fell 0.1 percent, disappointing economists looking for growth of 0.4 percent.
Also, January's drop was revised to just 0.1% from the 0.3% drop that was initially reported.
However, excluding automobiles and gasoline, retail sales edged higher by 0.3%, a sign of health in the broader economy.
Meanwhile, U.S. wholesale prices rose slightly in February, roughly in line with the tepid growth seen in consumer prices.
On a monthly basis, the producer price index that measures wholesale inflation was up 0.2% following January's 0.4% increase. That's tepid but still more than the 0.1% growth expected by economists.
The currency fell against its major rivals in the Asian session.
The greenback retreated to 0.9443 against the Swiss franc, from a high of 0.9462 hit at 4:30 am ET. This may be compared to a 6-day low of 0.9425 set in the Asian session. If the greenback falls further, 0.93 is likely seen as its next support level.
The greenback reversed from an early high of 106.75 against the yen, falling to 106.32. Next key support for the greenback is likely seen around the 104.00 region.
Minutes from the Bank of Japan's January 22-23 meeting showed that members of the monetary policy board said that the country's economic growth is continuing at a satisfactory rate.
The members added that exports were on a rising trend, which was helping to fuel the recovery.
The greenback fell back to 1.3991 against the pound, heading to pierce more than a 2-week low of 1.3996 hit at 10:45 pm ET. The next possible support for the greenback is seen around the 1.42 level.
The greenback pulled back to 1.2397 against the euro shortly after the data, from an early high of 1.2362. This may be compared to a 6-day low of 1.2413 hit in the Asian session. The greenback is poised to find support around the 1.27 level.
Data from Eurostat showed that Eurozone industrial production declined for the first time in four months in January.
Industrial production decreased 1 percent month-on-month in January, in contrast to December's 0.4 percent rise. This was the first fall since last September and also bigger than the forecast of 0.4 percent drop.
The greenback declined to more than a 3-week low of 0.7916 against the aussie, after having advanced to 0.7851 at 6:30 pm ET. Continuation of the greenback's downtrend may see it challenging support around the 0.81 area.
The greenback retreated to 0.7349 against the kiwi and 1.2934 against the loonie, from its early highs of 0.7322 and 1.2966, respectively. On the downside, 0.75 and 1.28 are possibly seen as the next support levels for the greenback against the kiwi and the loonie, respectively.
U.S. business inventories for January are scheduled for release shortly.
Copyright RTT News/dpa-AFX