The dollar dropped to a low of $1.5651 against the euro and traded down to Y99.85 against the yen in early trade.
The greenback staged something of a recovery later in the session, however, to stand up 0.6 per cent at $1.5550 against the euro, 0.1 per cent higher at Y100.60 against the yen and 0.3 per cent stronger at $2.0280 against the pound.
The dollar, which on Thursday hit a record low against the Swiss franc, also edged 0.1 per cent higher to SFr1.1070 against the Swissie and gained 0.4 per cent to $0.9419 against the Australian dollar.
Traders said a rally in European equities had triggered a bout of profit taking on bets against the dollar, but still expected the greenback to remain under pressure.
The bleak outlook for the dollar was compounded on Thursday as a surprise fall in US retail sales boosted expectations that the Federal Reserve would have to slash interest rates at its policy meeting next week.
Some analysts said that the weakness of the dollar could prompt action from central banks, who thus far have stuck to verbal intervention in an attempt to arrest the currency’s slide.
He said the weak level of foreign participation in Thursday’s 10-year Treasury note auction, which was the third smallest on record, could indicate that that point had now been reached.