Stocks rose as investors hoped U.S. data could prompt the Federal Reserve to slow its current aggressive pace of rising interest rates over the next few months.
Thursday’s ADP National Jobs Report showed that the US payroll rose at a slower pace than expected last month.
Friday will be a calmer day, with the London markets closed for a holiday.
The dollar fell 0.1% to 101.75 against a basket of other major currencies, while the euro was up 0.1% to $1.0747.
Investors have had a mixed view of the greenback since hitting a 10-year high in mid-May.
George Saravelos, global head of currency research at Deutsche Bank, said the dollar “prices a safe-haven risk premium that is so extreme that it has rarely persisted over time and is is now unraveling”.
Bullish analysts argue that the Fed’s tightening cycle rests on a stronger growth story than Europe’s, especially after the Russian oil embargo, which could hurt the eurozone economy.
The European Union has decided on an embargo on imports of Russian crude oil which will take full effect by the end of the year.
“The dollar’s rally amid further hawkish signals from the Fed lacks momentum as the Dollar Index struggles to hold onto 102 again,” Unicredit analysts said in a research statement.
They pointed to comments by Fed Vice Chair Lael Brainard on Thursday that it was “very difficult” to see the case for a September pause in rate hikes, which did not failed to support the dollar.
Minutes from the Fed’s May meeting suggested that the central bank may end its tightening once the policy rate returns to neutral.
Meanwhile, the Swiss franc is hovering around levels reached in mid-May after Swiss National Bank President Thomas Jordan signaled that the central bank may act if inflationary pressures continue.
The SNB has so far stuck to its ultra-free policy, but Swiss prices rose to their highest level in nearly 14 years in May.
The yen was not far from its lowest level in 10 years against the greenback, around 130, as the Bank of Japan (BoJ) maintained its super low interest rate policy.
BoJ Governor Haruhiko Kuroda said on Friday that it was undesirable for prices to rise too much when household income growth remained weak.
The Canadian dollar was flat at 1.2571 against the greenback after surging the previous day as the Bank of Canada opened the door to a more aggressive tightening pace.
Bitcoin rose around 0.6% and last traded at $30,379. Ether fell 1% to $1,815.
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