The dollar weakened against major currencies on Friday as investors mulled slower than expected US first quarter growth and the increased prospects of QE3.

The Commerce Department said the US economy expanded a slower than expected 2.2% in the first quarter. Meanwhile separate reports showed US consumer spending and consumer sentiment perked up in April.

The dollar index, which measures the US currency's performance against a basket of six other currencies, declined to 78.733, from 79.138 late Thursday. For the week the index dropped 0.6%.

The euro was boosted by a successful Italian bond which soothed concern about rising unemployment in Spain and Standard & Poor's downgrade on its sovereign debt. The single currency fetched $1.3252 from $1.3243 the previous session and settled 0.3% over the week.

The dollar fell sharply against the yen on Friday, down ¥80.38 from ¥80.94 on Thursday as the Bank of Japan announced more monetary easing measures.

The Bank of Japan bolstered the size of its asset-purchase programme by ¥5trn to ¥70trn, a move that was widely expected. The central bank also kept interest rates unchanged between 0% and 0.1%.

The euro changed hands at ¥106.52 from ¥107.27 on Thursday and fell 1.2% over the week.

Sterling raced to a 22-month high against the euro after S&P's downgrade and inched close to an 8-month high against the dollar.





CJ

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