USD depreciated against most of its major rivals in the European session on Friday, as investors shrugged off inflation concerns.

The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, declined 0.24% to 92.81.

July’s inflation readings were mixed. The consumer price data indicated that inflation may be peaking, while the producer prices surprised to the upside, recording the largest annual gain in more than a decade. It seems, however, that market participants did not consider higher prices for producers an issue to worry about. 

Signals that inflation is moderating suggest that there is no need for the Federal Reserve to rush with its tapering plans. Nonetheless, Reuters’ poll shows that a solid majority of economists believe that the Fed might announce a plan to taper its $120 billion in monthly bond purchases in September.

In addition, several representatives of the U.S. central bank, who spoke earlier this week, expressed views that the withdrawal of monetary stimulus should begin in the fourth quarter.