The yen slipped on Tuesday in choppy trade while the dollar struggled against most currencies as earnings of Goldman Sachs and U.S. retail sales surpassed expectations, stoking modest hopes for an economic recovery

But traders were cautious ahead of quarterly results from other U.S. banks, while lackluster data from Germany weighed on the euro and kept it rooted in a broad range against the dollar.

The slight rise in risk appetite also boosted higher-yielding currencies such as the Australian dollar at the expense of both the yen and U.S. dollar, which tend to see their biggest gains when investors grow anxious and buy them as safe havens.

“Retail sales were better than expected, so that’s a bit of good news, but there’s been little follow-through as the market is uncertain which way it wants to trade,” said Greg Salvaggio, vice president of trading at Tempus Consulting in Washington.

The retail sales data came with some caveats, though, as traders noted much of the 0.6 percent gain in June retail sales was driven by higher gas prices.

Salvaggio also said data showing a sharp rise in U.S. producer prices last month, which pushed government bond yields up, may stoke inflation fears.

Midmorning in New York, the euro fell 0.1 percent to $1.3967 and rose 0.1 percent to 130.02 yen . The dollar edged up 0.1 percent to 93.10 yen . The yen had briefly erased losses against the dollar, pushing the greenback down to 92.72 yen as stocks dipped into negative territory, but fell anew as Wall Street recovered.

The euro’s woes were tied partly to a monthly poll of economic sentiment from German think-tank ZEW, which defied upbeat market expectations and fell in July for the first time in nine months.

Currencies considered higher risk, however, did better. Australia’s dollar rose 0.8 percent to $0.7889 , and sterling added 0.4 percent to $1.6297 . Strong Australian business confidence data and better-than-expected UK retail sales and home price data added to demand for both.

Source: NEW YORK, July 14 (Reuters)