Dollar Falls as Stocks Rally, Euro Gains from EU Economic Strength

The US dollar index fell by 0.02% on Friday and held just above Thursday's three-and-a-quarter-month low.

Strength in stocks on Friday reduced demand for dollar liquidity, which weighed down the dollar even further due to negative carryover from Wednesday's US Treasury boost of liquidity and long-dated bond buybacks.

The US economic news was mixed for the dollar, with the August S&P manufacturing PMI falling more than expected but the August S&P services PMI rising more than expected.

Meanwhile, the euro matched Thursday's three-and-a-quarter-month high and finished up by 0.02% on Friday, supported by signs of strength in the European economy after the Eurozone August manufacturing and composite PMI reports expanded more than expected.