Dollar gains on most currencies

NEW YORK (AFX) – The dollar rose against most major currencies Monday as investors awaited U.S. inflation data due out this week.

The 12-nation euro bought $1.2719 in afternoon New York trading, up from $1.2729 in New York late Friday. The British pound slipped to $1.8878 from $1.8901.

The dollar strengthened against the Japanese currency, climbing to 116.67 yen from 116.26 yen.

"It appears that we continued the good feelings from Friday after the positive retail sales report," said Michael Woolfolk, a senior currency analyst at the Bank of New York. "Now the markets want to get an update on core inflation."

The Labor Department reports Tuesday on producer price trends in July followed by an update on consumer prices on Wednesday. Both reports, especially the latter, are key inflation figures markets watched by the Federal Reserve.

Last week, the Fed kept interest rates unchanged at 5.25 percent — the first pause in more than two years — but left the door open for additional rate hikes if new economic data shows higher inflation.

Higher rates tend to support the dollar by increasing the returns on some dollar-denominated investments.

In other trading, the dollar bought 1.2415 Swiss francs, down from 1.2422 late Friday, and 1.1268 Canadian dollars, up from 1.1231.