1335 GMT - The dollar rose after the U.S. Commerce Department reported January retail sales fell 0.2 percent compared with an upwardly revised December figure of plus 0.2 percent. Economists polled by forecasted an average decline of 0.3 percent.
- However, excluding the automobile sector, a source of strength in the fourth quarter of last year due to special financing incentives, retail sales rose 1.2 percent, compared to forecasts indicating a 0.4 percent rise. The rise in sales outside the auto sector indicates the consumer sector remains resilient despite a sluggish economy.
- Euro/dollar trades at 87.23 cents, down 0.46 percent against a backdrop of negative newspaper headlines following Tuesday's decision by European finance ministers to drop a proposed warning to German over its budget deficit.
- Dollar/yen, trades at 132.65 yen, unchanged compared to Tuesday's New York close. Ahead of the retail sales figure, the dollar clawed back ground against the yen, having dropped as low as 132.17 yen, just above the key resistance level of 131.90 yen.
- Earlier, credit ratings agency, Moody's Investor Services warned it could slash Japan's Aa3 government domestic rating by up to two notches. That news follows comments from Standard & Poor's warning that a rating change could come sooner than expected unless economic recovery and structural reform materialize.