The US dollar was mixed in New York on Friday after a strong report on regional factory activity helped offset the effects of a report showing weaker-than-expected US growth in the second quarter.
The euro slipped to US$1.2015 against US$1.2043 late on Thursday in New York. The greenback, however, fell to ¥111.38 from ¥112.02 on Thursday.
The US currency lost ground after official figures showed the US economy grew at an annual rate of 3 percent in the second quarter, well below the consensus forecast for a rise of around 3.6 percent. A higher-than-expected number, however, for the Chicago purchasing managers index, which showed a rise to 64.7 percent last month against expectations for an increase to around 59 percent, led the greenback to recoup its losses.
Although the dollar has been on a roll over the past week, many analysts remain lukewarm to the greenback.
"The dollar rebound this week appears to reflect position squaring ... and low summer liquidity, rather than a change in fundamentals," said Citigroup's Steven Saywell.
The weak report on economic growth could halt the dollar's rally, added Bear Sterns currency strategist Steve Barrow.
Recently the market has shown a trend of reacting to strong US data rather than weak data, while ignoring some of the strong data that has come out of the EU, he said.
"This may hint that the market is coming to the end of a short squeeze in the US dollar, suggesting that the momentum has been lost," he said.
The yen got some support af-ter falling to six-week lows against the dollar on the back of higher oil prices, as the sell-off was largely viewed as overdone, analysts said. It also clawed back some lost ground against the dollar as Tokyo's benchmark Nikkei-225 index rebounded from Thursday's big sell-off, analysts said.
"Stock markets remain key to the yen's near-term fortunes," BNP Paribas analysts wrote in a note to clients. "The Nikkei's renewed gains have helped the yen improve its tone."
The dollar had surged to a two-month high point against the yen on Thursday.
In London, the dollar eased from two-month high points against the yen and also gave ground to the euro on Friday, dealers said.
"The dollar was in a relatively tight range overnight as investors decided to sit tight ahead of GDP data," Canadian Imperial Bank of Commerce economist Jodie Saul said.
The euro was changing hands at US$1.2053 from US$1.2043 late on Thursday in New York, ¥134.41 (134.83), £0.6636 pounds (0.6623) and 1.5403 Swiss francs (1.5416).
The dollar stood at ¥111.54 (112.02) and SF1.2782 (1.2799).
The pound was at US$1.8163 (1.8172), ¥202.46 (203.76) and SF3003 (2.3258).