Market liquidity was exceptionally thin, analysts say, with traders continuing to square up positions, hesitant to make bets in the penultimate trading session of 2005. "Overall, the dollar is flat but it has been quite soft in the New York time zone," said Michael Jansen, senior currency strategist, at National Australia Bank in NY.
"What the market seems to be focusing on are US home sales, which were quite a lot weaker than what people were hoping for. This is definitely weighing on the dollar via what people think that might mean for interest rates," he added.
In late trading, the euro was marginally higher at $1.1844, up about 0.1 percent from late Wednesday. The dollar was flat against the yen at 117.80 yen.
The dollar had ticked up earlier in the global session to around 118.00 yen, its highest in two weeks.
A snapshot of business activity in the Chicago area, which came in above expectations, failed to fuel excitement, but it was the decline in existing home sales that caught the market's attention.
Sales of existing homes in November fell 1.7 percent to a 6.97 million unit rate, the first time the pace had dipped below 7 million since March, according to the National Association of Realtors. Economists polled by Reuters had expected a decline to 7 million unit pace.
Meanwhile, the headline Chicago PMI for December came in at 61.5, exceeding economists' average forecast of 60.1. Readings above 50.0 denote expansion in the sector.
The two reports sent conflicting signals about the US economy. But with volumes so light ahead of the year-end, the data had minimal effect on exchange rates.
Sterling was up 0.4 percent at $1.7239, largely a function of euro/sterling easing from Wednesday's four-month high back down to 68.68 pence.
The dollar fell 0.2 percent against the Swiss franc to 1.3133 francs.
Earlier in the day, the National Association of Purchasing Management-New York said its index of business activity in New York City increased to 354.2 in December from 352.4 in November.
Japanese markets close early on Friday and the major currency trading centers of London, New York, Tokyo and Singapore are all closed on Monday for holidays.
The dollar will end 2005 on a strong note after a bear run between 2001 and 2004. It has risen nearly 15 percent against the yen and about 13 percent against the euro so far this year, bolstered by its interest rates advantage.
The dollar index has risen just under 13 percent, its first gain in four years. It is also the dollar index's best year since 1997, when it rose 13 percent. A rise above that level would mark the greenback's best performance since 1984, when it rose 15 percent.