LONDON (AFP) - The dollar drifted lower in quiet trade with markets already looking to a US interest rate verdict next week for direction after a recent run of largely inconclusive US economic data.
The single European currency fell to 1.2201 dollars from 1.2182 late on Thursday in New York.
The dollar rose to 109.97 yen from 109.61 on Thursday.
While a quarter point rise in US interest rates is widely expected on Tuesday, the statement accompanying the decision will be closely scrutinised for indications of when further rate hikes will come.
As things stand, "currency markets players can be no more confident in the outlook for US monetary policy than they were at the start of the week," said Simon Derrick, economist at Bank of New York.
The week has been a busy one for US data -- among them US producer and consumer prices, trade, current account and industrial production.
The current level of uncertainty has been a "recipe for range-trading" which is destined to continue for the foreseeable future, Derrick added.
"It is far from clear just when the accumulation of economic data will paint a picture of sufficient clarity to point the way forward," he said.
The Philadelphia Federal Reserve said Thursday its industrial activity index fell to 13.4 from 28.5 in August, suggesting growth in US manufacturing continued but at a markedly slower rate than in July.
US core consumer prices rose just 0.1 percent in August, below expectations for a rise of 0.2 percent, confirming the Federal Reserve's stance that inflation is under control.
Analysts believe the US Fed has room enough to skip hiking interest rates at its November 10 meeting if it finds that the soft patch in the overall economy is proving to be persistent.
The focus Friday was on the September University of Michigan consumer sentiment survey due for release.
"Perhaps just as important as the headline reading for confidence are respondents expectations for both short and long term inflation," West LB analysts said.
"The Fed is known to track these and other series that attempt to capture inflation expectations, which are a key ingredient feeding into Fed policy making," they added.
Consensus forecasts were for the headline reading to edge higher to 96.7 from 95.9 in August.
The euro was changing hands at 1.2201 dollars against 1.2182 late on Thursday in New York, 134.16 yen (133.51), 0.6798 pounds (0.6794) and 1.5462 Swiss francs (1.5453).
The dollar stood at 109.97 yen (109.61) and 1.2675 Swiss francs (1.2680).
The pound was at 1.7946 dollars (1.7926), 197.34 yen (196.45) and 2.2746 Swiss francs (2.2733).
On the London Bullion Market, the price of an ounce of gold stood at 404.55 dollars against 403.40 dollars late on Thursday.