NEW YORK (CNNMoney.com) - Bonds dipped Friday as traders capitalized on Thursday's big gains by selling off long-term Treasuries.

Much of the economic data of the day came in close to analysts' expectations and did not rattle the bond market.

Anticipated interest rate hikes in European countries caused overseas investors to sell U.S. Treasuries.

The dollar slipped against the euro and fell sharply against the yen.

The benchmark 10-year Treasury note slipped 6/32 to 98-20/32 to yield 4.67 percent, up from 4.64 late Thursday.

The 30-year bond lost 12/32 to 96-15/32, yielding 4.72 percent, up from 4.69 in the previous session. Bond prices and yields move in opposite directions.

The five-year note fell 3/32, yielding 4.62 percent, and the two-year note lost one tick, yielding 4.65 percent.

Industrial production came in almost exactly as economists expected. Industrial production rose 0.7 percent in February, though the Federal Reserve revised January's decline downward to negative 0.3 percent.

Bonds have rallied most of the week, with yields on the 10-year falling from 4.77 percent Monday to Thursday's 4.65, mostly on data suggesting mild inflation and slowing economic growth.

Inflation hurts bonds as it erodes the value of the fixed-interest paying investment.

Weaker inflation and economic numbers raised speculation that the Fed may end its rate-tightening policy sooner than expected, pushing the dollar to a seven-week low against the euro and a two-week low against the yen. Lower interest rates make dollar-denominated investments less attractive.

The euro bought $1.2196, up from $1.2178 late Thursday, while the dollar slipped to ¥115.79, down from ¥116.84 in the previous session.

-- from staff & wire reports

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