* Dollar retreats from a one-month high marked on upbeat
* Dollar slips from a 2-1/2-week high vs yen
* U.S. Treasury yields pull back from a 3-week high
* Euro recovers from a 5-week low
* U.S. housing starts, Philly Fed Business Index in focus
By Yuzuha Oka
TOKYO, Feb 16 The dollar pulled back on Thursday
after rising to one-month highs in the wake of upbeat U.S.
economic data, with demand for the greenback cooling as Treasury
yields came off their peaks.
Better-than-expected U.S. inflation and retail sales data
had backed expectations of an early rate hike by the Federal
Reserve, sending the dollar index to 101.76 on Wednesday,
a peak unseen since Jan. 12. It has since retreated to 100.92 in
the Asia session on Thursday.
The dollar also came off from a 2-1/2-week high of 114.95
marked on Wednesday against the yen, touching a low of
113.73. It was last down 0.3 percent at 113.84 yen.
"The dollar is struggling as U.S. Treasury yields retreated
from highs," said Junya Tanase, chief currency strategist at
JPMorgan Chase Bank in Tokyo.
U.S. benchmark 10-year Treasury note yields slipped to 2.484
percent on Thursday, after climbing to a three-week
high of 2.524 percent on Wednesday following the upbeat U.S.
Data on Wednesday showed U.S. consumer prices recorded their
biggest gain in nearly four years, jumping 0.6 percent in
January. Retail sales also outpaced expectations, increasing 0.4
percent last month compared to the analysts' poll of 0.1
But some analysts also noted that the data may not be as
strong as it appears, while industrial output and a gauge on
home builder sentiment took unexpected spills.
"Retail sales seemed to have been boosted by higher prices
rather than an increase in the real consumption," said Shin
Kadota, senior forex strategist at Barclays.
"Investors also took profit as the dollar was trading high
this week," added Kadota.
Up until Tuesday, the dollar index had enjoyed a 10-session
Fed Chair Janet Yellen offered no additional insight on the
timing of the central bank's next rate hike in her second day of
economic testimony before Congress on Wednesday.
On Tuesday, Yellen hinted more rate hikes were on the way as
the jobs market has improved and inflation has shown signs of
nearing the Fed's two percent goal.
Markets will get another chance to check the U.S. economic
pulse from another batch of data, including housing starts,
building permits and the Business Outlook Survey by Reserve Bank
The euro edged up 0.15 percent at $1.0614, recovering from a
five-week trough of $1.052 touched on Wednesday.
Elsewhere, the Australian dollar hovered near a three-month
high following a slightly better-than-expected reading in the
country's January employment data.
The Australian dollar last traded at $0.7709 after
touching $0.7732, its highest since Nov. 10.
Sterling last stood at $1.2460, edging up from a
one-week trough of $1.2384 touched on Wednesday, knocked by
slowing wage growth in the fourth quarter - bad news for
British consumers facing a surge in inflation in the months
(Reporting by Yuzuha Oka; Editing by Eric Meijer & Shri