NEW YORK, May 26 (Xinhua) -- The U.S. dollar weakened against major currencies despite elevated inflation pressures as investors stayed optimistic on the outlook of U.S. debt ceiling talks.

The dollar index, which measures the greenback against six major peers, decreased 0.04 percent to 104.2036 in late trading.

U.S. stocks were trading sharply higher Friday. Tech-heavy Nasdaq was up more than 2 percent Friday afternoon, as hopes rose for a debt-ceiling deal in Congress.

U.S. House Speaker Kevin McCarthy said Thursday evening, "We've been talking to the White House all day, we've been going back and forth, and it's not easy. It takes a while to make it happen, and we are working hard to make it happen."

U.S. President Joe Biden also said Thursday afternoon that negotiators were "making progress."

"This morning's headlines are suggesting that after various meetings, the gaps between the White House and the House majority are narrowing when it comes to an agreement. Naturally, this knocked away some of the strength the buck had counted on throughout May," said a note by Monex USA, a provider of foreign exchange, risk management, and international payment solutions.

The personal consumption expenditures (PCE) price index, which measures a variety of goods and services and adjusts for changes in consumer behavior, rose 0.4 percent month on month in April, higher than 0.3 percent of forecast consensus and 0.1 percent of expansion in March, according to data issued by the U.S. Bureau of Economic Analysis on Friday.

"That is not what the Fed wants to see," said Andrew Patterson, senior international economist at Vanguard. "The pickup in services... is not good news for the Fed in terms of bringing inflation back down to target."

In late New York trading, the euro was up to 1.0730 dollars from 1.0722 dollars in the previous session, and the British pound rose to 1.2350 dollars from 1.2318 U.S. dollars in the previous session.

The U.S. dollar bought 140.6220 Japanese yen, higher than 139.9710 Japanese yen of the previous session. The U.S. dollar decreased to 0.9047 Swiss francs from 0.9063 Swiss francs, and it fell to 1.3615 Canadian dollars from 1.3638 Canadian dollars. The U.S. dollar fell to 10.8130 Swedish Krona from 10.8328 Swedish Krona.