The dollar remained firm against the euro on Friday even after a widely-watched gauge of consumer sentiment missed expectations.

Better-than-expected housing data firmed market views that the economy is on the mend despite setbacks here and there and is in less need of monetary stimulus programs that weaken the dollar to spur recovery.

In U.S. trading, EUR/USD was trading at 1.3563, down 0.42%, up from a session low of 1.3556 and off a high of 1.3650.

The pair was likely to find support at 1.3549, the low from Jan. 9, and resistance at 1.3699, Tuesday''s high.

The preliminary Thomson Reuters/University of Michigan consumer sentiment index fell to 80.4 in January from 82.5 in December, defying expectations for a rise to 83.5.

Separately, official data showed that U.S. building permits declined 3% to 986,000 million units in December from 1.017 million units the previous month. Analysts had expected building permits to slip to 1.015 million units last month.

Data also showed that U.S. housing starts rose dropped 9.8% and came in at 999,000 units in December from an upwardly revised 1.107 million units in November.

Markets were expecting see 990,000 in new housing starts, and the better-than-expected figure boosted spirits by suggesting fundamental improvements are taking place in the U.S. housing sector.

The euro was down against the pound, with EUR/GBP sliding 1.00% to 0.8246, and down against the yen, with EUR/JPY trading down 0.52% 141.39.

The pound firmed after official data revealed that U.K. retail sales increased by 2.6% in December, far more than the expected 0.4% rise. Retail sales in November were revised down to a 0.1% rise from a previously estimated 0.3% gain.

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