Forex Today: Dollar sellers pause, but retain control

What you need to know on Friday, January 14:

The market stabilized, with the greenback consolidating losses on Thursday. Risk appetite receded, preventing the dollar from falling further. Intraday gains of the American currency helped correct oversold conditions reached after Wednesday's sell-off.

The Federal Reserve's hawkishness was pretty much priced in ahead of the release of US inflation figures, with three rate hikes anticipated for this year and chances of a balance sheet runoff before the year-end, resulting in the report triggering the opposite-than-usual reaction to skyrocketing prices pressure.

The GBP/USD pair extended gains to 1.3748, a fresh two month high, to finish the day with modest gains around 13715. The pound ignores headlines showing that UK's Boris Johnson's premiership is at risk amid breaking lockdown rules last year. Also, Brexit keeps making it to the front line, with UK Trade Minister Truss stating that the UK hopes to have an agreement with the trans-pacific partnership Trade Bloc in the next few years.

The EUR/USD pair hit 1.1481, ending the day at around 1.1460. European Central Bank Vice President Luis de Guindos said the European economy is getting used to the coronavirus,  adding that "perhaps inflation won't be as transitory as forecast only some months ago," although he expects it to stay below the ECB's target in 2023 and 2024.

Commodity-linked currencies finished the day little changed. AUD/USD trades around 0.7290, while USDCAD stands at 1.2490.

The USD/JPY pair extended its slide and currently flirts with the 114.00 level.

Spot gold retreated modestly, currently trading at around $1,820 a troy ounce, while crude oil prices were weighed by the soft tone of equities. WTI settled at $81.70 a barrel.

US government bond yields ticked higher but were unable to retain gains, ending the day barely up. Wall Street, on the other hand, was incapable of extending its gains, with most indexes posting modest intraday losses.

Friday will be quite a busy day, as the UK will publish its November Gross Domestic Product and Manufacturing Production for the same month, while the US will offer December Retail Sales and the preliminary estimate of the January Michigan Consumer Sentiment Index.

Ethereum must close the week above $3,300, or ETH will resume selling