LONDON (AFP) - The dollar fell against the euro with investors losing their interest in the US currency on expectations that the US Federal Reserve would follow a gradual approach to raising interest rates.
The euro in late-day trade was at 1.2292 dollars after 1.2268 late on Wednesday in New York.
The dollar was meanwhile trading at 110.41 yen against 110.54 on Wednesday.
The dollar's slide against both the euro and sterling continued Wednesday's trend, which was triggered a Federal Reserve statement Tuesday suggesting the US central bank might soon take a pause from hiking interest rates.
But other factors are also weighing on the US currency. Higher oil prices, falling equity markets and a switch into bonds are all seen as negative for the dollar.
MMS International currency analyst Gary Noone noted that Thursday had seen a shift into high-yielding currencies, notably the Australian and New Zealand dollars and the Canadian dollar, with the Norwegian kroner also benefiting from the higher oil price.
Sterling in addition gained against the dollar, although it remained weak against the euro with the outlook for British interest rates looking softer after Wednesday's dovish minutes from the Bank of England's last meeting of its Monetary Policy Committee.
An IMF report that house prices in Britain face a sharp fall and a softer reading on the CBI industrial trends survey failed to have much impact, however, suggesting that much of the bad news may already be priced in.
Oil prices also affected sentiment. Although oil prices eased slightly on Thursday after Wednesday's surge, they remain high, pushing towards levels not seen since mid-August when US crude futures came close to 50 dollars per barrel.
Among the majors, the high oil price stung the yen the most, with Japan a 100 percent net importer of oil and its economy seen as highly sensitive to any spike in crude prices.
"The yen and other Asia currencies continue to lag as yesterday's (Wednesday) surge in crude to new highs is perceived to undermine global growth and equity market prospects," said UBS analyst Daniel Katzive.
The Japanese currency slipped to near five-week lows against the euro and sterling, although falls against the dollar were less pronounced due to negative dollar sentiment.
The euro was changing hands at 1.2292 dollars against 1.2268 late on Wednesday in New York, 135.71 yen (135.67), 0.6831 pounds (0.6837) and 1.5472 Swiss francs (1.5449).
The dollar stood at 110.41 yen (110.54) and 1.2586 Swiss francs (1.2591).
The pound was at 1.7995 dollars (1.7938), 198.66 yen (198.23) and 2.2643 Swiss francs (2.2587).
On the London Bullion Market, the price of an ounce of gold stood at 411.50 dollars against 408.50 dollars late on Wednesday.