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The U.S. dollar stayed positive right through the session on Friday amid hopes the Federal Reserve is unlikely to announce aggressive cuts in interest rate.

Optimism about trade talks too contributed to the dollar's rise on Friday. However, reports that the Chinese officials have changed their travel plans to head back to China earlier than scheduled have raised doubts about the progress of negotiations between the two countries.

The dollar index, which rose to 98.64 around noon, eased to 98.47 later on in the day. Still, it was up 0.2% from previous close.

Against the euro, the dollar was up 0.2% at 1.1019, despite an improvement in Eurozone consumer confidence.

Preliminary data from the European Commission showed eurozone consumer confidence improved in September to its highest level in four months, after weakening in August.

The flash consumer confidence index climbed to -6.5 from -7.1 in August. Economist had forecast a modest improvement to -7. The latest reading was the highest since May, when it was at the same -6.5 level.

The Pound sterling was weaker by about 0.4% with a unit of sterling fetching $1.2474, compared with $1.2522 late Thursday. Lingering worries about Brexit uncertainty weighed on the British currency.

Against the Yen, the dollar was weaker by about 0.45%. The yen was trading at 107.54 a dollar, recovering from its overnight level of 108.02 a dollar.

The dollar was up marginally against the loonie with the dollar-loonie pair at 1.3268, after data showed a drop in Canada's core retail sales.

Data from Statistics Canada showed that core retail sales, excluding motor vehicle and parts dealers, dropped 0.1% in July after rising 0.9% in the previous month. Retail sales rose 0.4% on a seasonally adjusted monthly basis in July following a flat reading last month. Economists had forecast a 0.6% increase.

Against Swiss franc, the dollar shed about 0.16% at 0.9911, while it declined nearly 0.5% against the Aussie at 0.6761.