The dollar showed some strength in Friday's early afternoon trading in New York, as traders considered a mixed batch of news from the world's leading economies.

The buck extended the week's gains against the euro, posting a multi-week high against the currency. Meanwhile, the greenback continued its upward move against the sterling after rebounding from a multi-month low posted earlier this week.

U.S. consumer sentiment rose unexpectedly despite concerns about consumer demand and spending ability were raised earlier in the week on the heels of some disappointing economic reports.

Overseas, Jean-Claude Trichet, President of the European Central Bank, defended the strength of the euro amid the grip of the worldwide recession, while stressing the need for monetary policy action to restore confidence and growth in the Eurozone.

Economic news from the Eurozone showed that the trade deficit dropped by more than expected while construction figures fell after ticking up the previous month.

Meanwhile in the U.K., disappointing data from the housing sector showed continued reason for concern in the much beleaguered industry.

Japan saw mixed news as consumer confidence rose to a five-month high in March, while the Bank of Japan lowered its economic assessment in seven of the country's nine regions.

With the influx of data ahead of the weekend, traders largely hedged their bets by bulking up on their positions in the greenback.

The dollar added to its recent gains against the euro, reaching a level of 1.3032, up from midnight's quote of 1.3186. With the move, the buck has moved past resistance of 1.3102 posted late last week, moving to its highest level since mid-March.

The Reuters/University of Michigan's consumer sentiment index for April rose to 61.9, a substantial increase from the previous reading. Analysts expected the index to rise to 58.5 from 57.3 in March.

In other news, Federal Reserve Chairman Ben Bernanke is scheduled to speak at a Fed conference in Washington at 12:30 PM ET today, discussing financial services for the underserved.

The upward move has the dollar looking to challenge its high of the year, a quote of 1.2521 posted earlier in March.

ECB chief Jean-Claude Trichet said authorities should do all possible things to restore confidence and support growth, while defending the euro's strength against its counterparts, most notably the U.S. dollar.

Comments of the ECB President have been especially closely watched ahead of the ECB rate-setting session scheduled for May 7th.

Earlier this week, Governing Council member Axel Weber said there is still a little room to cut the main refinancing rate, but it should not go below 1 percent.

The Eurostat reported that the trade deficit narrowed to EUR 2 billion in February from January's revised EUR 10.9 billion deficit. Economists had expected the deficit to contract to EUR 5 billion. After adjusting for seasonal variations, the trade balance recorded a deficit of EUR 4 billion in February versus EUR 5.4 billion shortfall in January. The adjusted deficit narrowed more than the expected deficit of EUR 4.9 billion.

Eurozone's construction output fell a seasonally adjusted 1.8 percent month-on-month in February, following a 1.6 percent rise in the previous month, the Eurostat said in a separate report.

Against the pound, the buck posted considerable gains after recording a fresh multi-month low of 1.5070 earlier in the week. In the early afternoon hours, the buck is sitting at 1.4769, slightly off of a multi-day high of 1.4758.

A report released in the U.K. by the Council of Mortgage Lenders said around 900,000 home-owners in the UK presently have some degree of negative equity, although the majority of these, about two thirds face only modest shortfalls of less than 10 percent.

The dollar saw little change in recent trading after backing off the century mark earlier this week. In the early afternoon, the dollar is sitting at 99.18, just below its overnight quote. With the lack of conviction, the dollar has continued to hover near a multi-month high of 101.43.

Japanese consumer confidence rose to a five-month high in March, while the Bank of Japan lowered its assessment in seven of the country's nine regions.

A report from Japan's Department of Economic and Social Research Institute showed that the consumer confidence index rose to 28.9 in March from 26.7 in the previous month. The improvement in the index was close to the expected level of 29. Consumer confidence increased for the third consecutive month in March after falling to 26.2 in December.

Elsewhere, the BoJ lowered its assessment on seven of the country's nine regions in its latest regional economic report. The central bank's view on Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Kinki, Shikoku and Kyushu-Okinawa underwent downward revisions. Meanwhile, the central bank maintained its view on Tokai and Chugoku.

Japan's Cabinet Office maintained its economic assessment for the second straight month saying that the economy is worsening rapidly while in a severe situation. In its monthly report for April, the government had lowered its assessment of business sentiment, while raised its evaluation of exports and public investment.

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