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The U.S. dollar gave up its early gains against its key counterparts in the New York session on Friday, after Federal Reserve Chair Jerome Powell reiterated that the central bank would act as appropriate to sustain the economic expansion.

Speaking at annual Economic Policy Symposium in Jackson Hole, Powell said that the economy is close to Fed goals of maximum employment and price stability.

"Our challenge now is to do what monetary policy can do to sustain the expansion so that the benefits of the strong jobs market extend to more of those still left behind, and so that inflation is centered firmly around 2 percent," he said.

"We are examining the monetary policy tools we have used both in calm times and in crisis, and we are asking whether we should expand our toolkit," he added.

The currency has been trading higher against its major counterparts in the previous session.

The greenback retreated to 0.9830 against the franc, from a 3-week high of 0.9877 it touched at 6:45 am ET. At yesterday's trading close, the pair was quoted at 0.9837. Next key support for the greenback is seen around the 0.96 area.

After rising to an 8-day high of 106.73 against the yen at 7:45 am ET, the greenback reversed direction and eased off to 106.34. The pair had closed Thursday's deals at 106.43. The greenback is seen finding support around the 104.00 level.

Data from the Ministry of Internal Affairs and Communications showed that Japan inflation rose 0.5 percent on year in July.

That was shy of forecasts for an annual increase of 0.6 percent and down from 0.7 percent in June.

The greenback, having risen to a new 3-week high of 1.1052 against the euro at 6:45 am ET, changed direction and was trading at 1.1074. The pair was worth 1.1079 when it closed deals on Thursday. The greenback is poised to find support around the 1.12 level.

The greenback was a tad weaker at 1.2234 versus the pound, down from yesterday's trading session close of 1.2250. Should the greenback drops further, it may face support around the 1.24 level.

The greenback declined to 1.3293 against the loonie, from a 3-day high of 1.3339 seen at 8:00 am ET. The greenback was trading at 1.3303 against the loonie at yesterday's close. Further downtrend is likely to take the greenback to a support around the 1.30 level.

The greenback pulled back to 0.6396 against the kiwi and 0.6761 against the aussie, from its early high of 0.6363 and a 9-day high of 0.6736, respectively. The greenback was worth 0.6757 per aussie and 0.6365 per kiwi at Thursday's New York session close. The currency is likely to find support around 0.66 against the kiwi and 0.69 against the aussie.