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New York - The US dollar rose against the euro for a second day Friday, hitting its best level since early December as traders remained risk-averse in the thin holiday season action.
At 22:00 GMT the euro dropped to $1.3586 from $1.3665, and was well down from the $1.3812 it hit on December 31.
Analysts said forex traders were cautious in the low liquidity of the New Year period, with many waiting to see what fresh US data next week will tell investors about the Federal Reserve's plans for further stimulus reductions.
"Participation next week, however, will fill out; and the more prominent themes of 2013 will be weighed upon for the new trading year," said John Kicklighter of DailyFX.
"Of particular interest in the week ahead will be the market's assessment of the Fed's decision to taper last month and the expectation that the central bank will cut the monthly asset purchase program by $10bn at each subsequent meeting.
"That forecast holds serious implications for both US and global markets," he added.
The yen meanwhile lost ground to the greenback but rose against the euro.
The dollar bought ¥104.85 yen compared to ¥104.69 yen Thursday, while the euro slipped to ¥142.44 yen from ¥143.06.
The British pound also lost ground against the dollar, falling to $1.6413 from $1.6444. And the dollar also pulled higher against the Swiss currency, to 0.9054 franc from 0.8991 franc.
