NEW YORK, Dec. 11 (Xinhua) -- The dollar rose against major currencies on Friday after a couple of strong U.S. economic reports lifted expectations of interest rate increases from the Federal Reserve.

    The Reuters/University of Michigan consumer sentiment index jumped by 6 points in the first half of December to 73.4, its highest level since September. Sub-index of sentiment about current economic conditions jumped by 10.3 points to 79.1. Consumer expectations rose more modestly by 3.2 points to 69.7. Short-term inflation expectations dropped sharply to 2.1 percent.

    A number of positive developments helped to boost consumer sentiment in recent weeks. With further gains in stock market valuations, household net worth prospectively will continue rising. Conditions in the labor markets started to improve with unemployment rate edged down in November. Inflation expectations dropped as gasoline prices fell, while retailers and automakers continued to offer deep fall and winter selling season discounts.

    "This is a very timely improvement arriving precisely at the busiest and most critical period of the retail sales season," said analysts of Global Insight.

    U.S. retail sales rose by 1.3 percent month-to-month in November, significantly more than an expected increase of 0.6 percent, the Commerce Department reported. Sales in November is 1.9 percent higher than a year ago. Core retail sales -- sales excluding autos, gas and building materials -- rose by a healthy 0.5 percent. The report suggests this year's holiday shopping season has gotten off to a reasonably healthy start, according to analysts of Nomura Economic Research.

    In the past year, foreign exchange investors took the dollar as a safety haven currency. The dollar tends to fall on positive economic news.

    The greenback jumped higher last Friday after the November non-farm employment report turned out to be much stronger than expected. But it's too early to say whether the correlation between weak dollar and good news is fading. Investors are closely watching the U.S. Federal Reserve monetary policy meeting due next week.

    The euro bought 1.4671 dollars in late New York trading compared with 1.4720 dollars it bought late Thursday. The pound fell to 1.6241 dollars from 1.6264 dollars.

    The dollar rose to 1.0606 Canadian dollars from 1.0504 Canadian dollars, and rose to 1.0341 Swiss francs from 1.0266 Swiss francs. It rose to 89.18 Japanese yen from 88.20 Japanese yen.

Special Report:  Global Financial Crisis