Dollar pressured by lower oil, weak US consumer sentiment

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The dollar fell broadly on Friday as a slide in oil prices ahead of weekend talks among producers in Doha and a soft U.S. consumer sentiment report capped risk appetite and spurred investors to buy safe-haven currencies such as the yen.

The dollar index, tracking the greenback's value against six major currencies, posted losses after two straight days of gains. The U.S. currency's fall versus the yen was the largest daily loss in more than a week.

"There's probably some anxiety about the Doha talks," said Shaun Osborne, chief currency strategist at Scotiabank in Toronto.

Oil producers led by top exporters Saudi Arabia and Russia will meet in Doha, Qatar on Sunday to discuss freezing output around current levels to contain an oil glut. It would be the first coordinated action by major OPEC and non-OPEC producers in 15 years.

U.S. crude futures fell 2.75 percent.

"Overall, I think the fact that oil producers are talking suggests that the psychology of the market has changed a little bit and probably the worst of the oil price declines is behind us. This would be good for risk sentiment going forward," Osborne said.

An underwhelming U.S. consumer sentiment report on Friday also weighed on the dollar and dampened tolerance for risk. The University of Michigan survey of consumer sentiment showed a preliminary reading of 89.7 for April, compared with a forecast of 92.

"The decline in Michigan sentiment is another reminder that all is not well with U.S. consumers despite solid jobs data," said Brian Dolan, head market strategist at DriveWealth LLC, in Chatham, New Jersey.

"Following on disappointing March retail sales, today's dip augurs poorly for a quick rebound in consumer activity in the second quarter."

In afternoon trading, the dollar index slid 0.24 percent to 94.68. For the week though, the index was poised to end on a positive note with a 0.5 percent rise.

Against the yen, the greenback fell to 108.61 yen, its biggest daily loss since April 7. The dollar so far this year is down nearly 10 percent, on track for its worst year since 2010.

The euro rose 0.2 percent to $1.1285, rising after three consecutive days of losses.

The gathering of G20 financial leaders in Washington this weekend has also created some nervousness. Going into the event, Japanese officials have commented on the yen's supposedly "excessive" moves. Their comments, however, have not deterred the yen from gaining.