Dollar trades higher on earnings jitters

The dollar climbed Friday as the second-quarter earnings season kicks off and investors continued to move into the safety of the American currency.

The 16-nation euro fell to $1.3947 from $1.4036 late Thursday in New York, while the British pound slid to $1.6192 from $1.6357. The dollar fell to 92.34 Japanese yen from 93.01 yen.

Unrelenting worries over the economy, driven by poor reports on unemployment, consumer confidence and falling commodity prices, have pushed investors into the haven of the dollar and the yen.

Aluminum maker Alcoa Inc. unofficially kicked off the period with better-than-expected results on Wednesday, but a warning from Chevron Corp. late Thursday put investors back on the defensive.

The pace of reports picks up speed next week with results coming in from heavy hitters such as Johnson & Johnson, JPMorgan Chase & Co., Google Inc. and General Electric Co.

Meanwhile, the Commerce Department said Friday the U.S. trade deficit fell to the lowest level in more than nine years in May as exports posted a small gain while the weak American economy pushed imports down for a 10th straight month.

The dwindling deficit reflects the prolonged U.S. recession, which has sharply reduced American demand for imported goods. U.S. exports also are down from last year's peaks, hurting American manufacturers, but those declines have been smaller than the plunge in imports.

Oil prices sank below $60 a barrel Friday on growing pessimism about the economy.

After falling close to $30 per barrel, crude prices had been rising steadily and peaked last week above $73. But dismal jobs numbers suggested energy use will be muted for some time, and prices have tumbled 19 percent since then.