LONDON (AFP) - The dollar retreated slightly, pressured by a rebound in the price of oil and other commodities and the prospect of a widening of the US trade deficit, analysts said.
The single European currency rose to 1.2363 dollars in early European trading from 1.2344 dollars late on Wednesday in New York.
The dollar traded at 109.44 yen from 109.65.
The US currency had risen Wednesday as so-called currency commodities such as the Australian and Canadian dollars suffered from a sharp fall in the price of oil, copper and other base metals.
"Out of default as those currencies go down then the dollar goes up against the likes of the euro, pound and yen," said Steve Barrow, a currency strategist at Bear Stearns.
But oil prices rebounded strongly late Wednesday while other hard commodities found a steadier footing Thursday. US crude oil futures were up 44 cents at 54.08 dollars a barrel, after a 1.13-dollar gain on Wednesday.
"Today we've had a big reversal in oil obviously, but other commodities as well have tended to stabilize and go back up a little bit ... and that's tended to weaken the dollar."
Daragh Maher, senior forex strategist at CALYON, said the sharp drop in the value of commodity currencies had "underlined the vulnerability of these high yielders to commodity price declines."
Dealers were awaiting US trade data, expected to show a widening of the deficit to 51.5 billion dollars in August from 50.1 billion in July.
Hans Redeker, chief forex strategist at BNP Paribas, said that the breakdown of the figures could be more revealing.
He said the dollar would come under renewed pressure if the report showed simultaneously declining exports and imports.
Markets were also hoping for direction from Friday's US retail sales report for September. Redeker said core sales would need to rise by more than 0.3 percent on a month-on-month basis to provide the dollar support.
"The near term prospect for the dollar has weakened and the overnight decline of bond yields, cross currency yield differentials and equity markets suggest the dollar will remain under pressure," he added.
The euro was changing hands at 1.2363 dollars from 1.2344 late on Wednesday in New York, 135.30 yen (135.45), 0.6862 pounds (0.6878) and 1.5447 Swiss francs (1.5450).
The dollar stood at 109.44 yen (109.73) and 1.2494 Swiss francs (1.2516).
The pound was at 1.8014 dollars (1.7941), 197.19 yen (196.85) and 2.2507 Swiss francs (2.2454).
On the London Bullion Market, the price of an ounce of gold stood at 414.05 dollars against 411.25 on Wednesday afternoon.