The US dollar got a modest lift on Friday from news that the US current account gap, the broadest measure of trade and investment flows, narrowed unexpectedly in the first three months of this year.
The euro dipped to US$1.2622 in late European trading from US$1.2631 late on Thursday in New York.
The US dollar rose to ¥115.13 from ¥114.82 on Thursday.
The US Commerce Department said that the current account deficit narrowed to US$208.7 billion from a record high of US$223.1 billion in the final quarter of last year.
But while the deficit contracted more than most investors had expected, Jay Bryson at the Wachovia bank still believed it had become harder to finance the gap as returns on dollar assets narrowed.
"Looking forward, we expect that the dynamics of the balance of payments will continue to exert downward pressure on the greenback," he said.
The current account deficit may not get much bigger, but it would probably not decline significantly soon.
Additionally, the gap between interest rates in US and the rest of the world is likely to get smaller over the coming months as the Fed nears the end of its cycle of rate increases while other central banks are expected to continue raising rates.
This would reduce the relative attractiveness of US assets, and weigh on demand for the dollar.
In Europe meanwhile, an unexpected decline in eurozone industrial output in April weighed on the euro.
Industrial production fell by 0.6 percent in April from March, Eurostat, the EU statistics office, said. Output rose 1.9 percent on a 12-month basis.
The figures confounded market expectations for a month-on-month rise of 0.5 percent and a year-on-year increase of 3.2 percent.
The euro was changing hands at US$1.2622 against US$1.2631 on Thursday, ¥145.35 (145.05), ¥0.6829 (0.6831) and 1.5564 Swiss francs (1.5553).
The US dollar stood at ¥115.13 (114.82) and 1.2330 Swiss francs (1.2311).
The pound was being traded at US$1.8484 (1.8484).
On the London Bullion Market, the price of an ounce of gold rose to US$574 per ounce, from US$569.50 late on Thursday.
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