1st LD Writethru: U.S. dollar rises on Yellen's speech

The U.S. dollar soared against other major currencies on Friday as Federal Reserve Chair Janet Yellen said she expected the Fed to raise interest rates this year if the economy remains on track for her forecasts.

In a speech in Providence, Rhode, Yellen assured investors that a slowdown in the U.S. economic growth in the first quarter was due to temporary factors including weather conditions and " statistical noise," adding that she believed that the economic data would strengthen.

"For this reason, if the economy continues to improve as I expect, I think it will be appropriate at some point this year to take the initial step to raise the federal funds rate target" and start to normalize monetary policy gradually, she said.

On the economic front, the Consumer Price Index (CPI) for all urban consumers increased 0.1 percent in April on a seasonally adjusted basis, in line with market consensus, said the U.S. Labor Department Friday.

The core CPI (excluding food and energy) climbed 0.3 percent in April, the biggest monthly increase in two years, lifting the year- over-year rate to 1.8 percent, the report showed.

The dollar index, which measures the greenback against six other currencies, was up 1.02 percent at 96.223 in late trading.

In late New York trading, the euro dropped to 1.1012 dollars from 1.1133 dollars in the previous session, and the British pound declined to 1.5481 dollars from 1.5672 dollars in the previous session. The Australian dollar went down to 0.7819 dollars from 0. 7894 dollars.

The U.S. dollar bought 121.53 Japanese yen, higher than 120.97 yen of the previous session. The U.S. dollar rose to 0.9433 Swiss francs from 0.9353 Swiss francs, and it increased to 1.2301 Canadian dollars from 1.2204 Canadian dollars. Endite