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NEW YORK (AP) - The dollar rose slightly against the euro and pound on Friday, benefiting from nervous currency investors withdrawing from risky "carry trades."

A slumping Wall Street, which fell more than 300 points on Friday, drove traders away from those trades.

Carry trades involve borrowing currencies from countries with low interest rates, such as Japan and Switzerland, and investing the funds in higher-yielding assets elsewhere. Carry-trade beneficiaries are usually the euro and currencies of countries with high interest rates, such as the New Zealand kiwi.

The 15-nation euro was worth $1.4785 in late New York trading, a little below the $1.4793 it was worth Thursday after Federal Reserve Chairman Ben Bernanke said the U.S. central bank would act aggressively in confronting economic woes -- signaling more interest rate cuts -- and the European Central Bank sounded a hawkish note on interest rates. Those announcements drove the dollar lower.

Lower interest rates can jump-start a country's economy, but may weigh on the currency as traders transfer funds to countries where they can earn higher returns.

The British pound dropped to $1.9573, down from $1.9609. On Thursday, the Bank of England kept its own rate unchanged, but signaled a cut was likely in February.

The dollar was down to 108.91 Japanese yen from 109.54 yen and 1.1010 Swiss francs from 1.1045 Swiss francs.

Also on Friday, the U.S. Commerce Department reported that the country's trade deficit surged to the highest level in 14 months in November, reflecting record imports of foreign oil. The deficit with China declined slightly while the weak dollar boosted exports to another record high.

In other New York trading, the dollar rose to 1.0206 Canadian dollars, up from 1.0108 Canadian dollars.