A series of negative economic reports Friday sent the dollar falling on speculation the Federal Reserve will push interest rates lower.
Gold dropped in active trading.Analysts said the dollar fell after two government reports on the economy provided further evidence that the economy is weakening.
The Labor Department said the unemployment rate was unchanged last month from September's 5.7 percent, but non-farm payrolls fell by 70,000, indicating businesses have less demand for workers.
The government also reported that its chief economic forecasting gauge, the Index of Leading Economic Indicators, dropped 0.8 percent in September for its second straight monthly drop.
Foreign exchange markets sold the dollar down following the release of both reports, believing the data would put more pressure on the Fed to nudge interest rates lower as a means of stimulating the economy.
Lower U.S. interest rates are bad news for the dollar, which like all currencies is supported by higher rates.
Jack Barbanel, a market analyst with First Global Asset Management Inc., said the dollar was further hurt by Germany's decision Thursday to raise a key interest rate, the Lombard rate. The increase gave more support to the German mark.
The dollar fell to 1.4945 marks in New York Friday from 1.5035 late Thursday. In earlier European trading, the dollar fell to 1.5020 German marks, from 1.5070.
In Tokyo, the dollar fell to a closing 129.10 Japanese yen from 130.70 yen at Thursday's close. Later, in London, it fell to 128.50 yen, and the dollar closed at 127.78 yen in New York, down from 130.555.