The 12-nation euro fell slightly against the U.S. dollar on Friday, losing some ground from the day before. In morning trading, the euro bought US$1.1779, down from US$1.1813 late Thursday in New York, where the common currency rose after a European Central Bank board member indicated more interest rate hikes may be needed. The dollar bought 120.68 Japanese yen, up from 120.26 the night before, and the British pound fell to $1.7484 from $1.7530 in New York. Much of the currency market's focus recently has been on interest rates, and the pound's rise on Thursday came after the Bank of England held official rates steady at 4.5 percent for the fourth consecutive month. Last week, the euro began gaining strength after the ECB changed its interest rates for the first time in two-years, increasing the key rate by a quarter of a percentage point to 2.25 percent. ECB board member Lorenzo Bini Smaghi on Thursday suggested that the hikes may continue, bolstering the currency. Typically, raising interest rates makes a nation's currency more attractive by increasing the return on investments. Still, most traders are convinced that signs of robust growth in the U.S. economy means that the U.S. Federal Reserve will also be continuing its policy of measured rate increases, which has brought its key rate to 4 percent. European and Japanese rates are expected to continue to rise more slowly than in the United States, making investments in those regions less attractive and sapping demand for their currencies.