Dollar bounces off 5-week low against euro after report shows slight jump in consumer prices

Dollar rises slightly after consumer prices rise

NEW YORK — The dollar edged higher against the euro Friday after the Labor Department said prices at the consumer level rose modestly in August.

The small rise in the consumer price index, which measures price changes at the retail level, calmed some worries about deflation in the U.S. Deflation would hurt the value of the dollar as wages and prices fall.

The euro gave up a penny after the report was released Friday morning in the U.S., falling from its high of $1.3159 reached earlier in the day. It fell to $1.3043 in late trading. The euro closed Thursday at $1.3080.

The dollar also held onto its big gains of the week against the Japanese yen for a second straight day. Japan’s central bank stepped in Wednesday to weaken the yen, which had been at a 15-year high against the dollar. Such a strong yen endangered the country’s manufacturers like Sony Corp. and Toyota Motor Corp., which profit from exporting goods.

One dollar bought 85.79 yen in afternoon trading, compared with 85.77 yen Thursday.

Elsewhere, the British pound fell to $1.5625 rom $1.5640 Thursday.

The Canadian dollar weakened slightly to 1.0311 to the dollar versus 1.0270 Thursday. The Swiss franc strengthened to 1.0120 versus 1.0146.