Oil prices neared 80 dollars per barrel Friday as the dollar fell and the market weighed a US Federal Reserve increase of its interest rate for emergency loans for banks.

New York’s main futures contract, light sweet crude for delivery in March, rose 75 cents to close at 79.81 dollars a barrel.

London’s Brent North Sea crude for April delivery gained 41 cents to 78.79 dollars.

The New York contract tried but could not break 80 dollars, hitting an intraday high of 79.95 dollars, analysts at BMO Capital Markets said.

“It will be quite interesting to see if key economic metrics next week reinforce the Fed’s decision and if they do, then 80 might just be around the corner,” the analysts said in a client note.

The market digested a sudden decision Thursday by the US Federal Reserve to increase its discount rate effective Friday, making it more expensive for banks to take short-term loans from the central bank.

Some analysts had speculated that the move was a pacesetter for a hike in the benchmark fed funds rate, currently at virtually zero percent.

But benign inflation figures on Friday indicated that the Federal Reserve could keep the fed funds rate unchanged for some time, they said.

The discount rate increase pushed the dollar to new nine-month highs against the euro early Friday but the single European currency recovered after the US Labor Department said its consumer price index rose by a lower than forecast 0.2 percent in January.

The core CPI, which excludes the prices of food and energy, dropped for the first time since 1982.

The European single currency was changing hands at 1.3550 dollars late on Friday compared with 1.3535 dollars late in New York on Thursday but it had fallen as low as 1.3443 dollars overnight, its lowest level since May 18.

A weaker dollar makes dollar-priced oil cheaper for buyers using stronger currencies, boosting demand.

“Oil did hit a five-week high but failed to take out 80. With the Fed move and with expiration of the March futures on Monday, it is unlikely that they will,” said Phil Flynn of PFG Best.

Oil prices also received a boost this week from more positive economic data.

Leading US economic indicators rose for the 10th consecutive month in January, pointing to a strengthening recovery in the next six months, the Conference Board said Thursday.

The business research firm said its forward-looking leading economic index (LEI) advanced 0.3 percent in January, after rises of 1.2 percent in December and 1.1 percent in November.

“This signals continued economic recovery at least through the spring,” said Ken Goldstein, an economist at the firm.