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The dollar settled near its lowest level in 16 weeks against a basket of major currencies on Friday, ahead of key data related to the labor market in the United States, while the yuan is heading to record its biggest weekly gain since China revalued its currency in 2005.
The dollar index, which measures the performance of the US currency against six other major currencies, including the yen and the euro, fell 0.1 percent to 104.55, after earlier reaching its lowest level since June 29 at 104.36.
The index fell more than five percent last month amid expectations that the Federal Reserve will start slowing the pace of interest rate hikes at its meeting in December.
Investors are now focusing on the US non-farm payrolls data due to be published on Friday, looking for indications of how higher interest rates will affect the labor market.
Meanwhile, the Chinese yuan rose 0.4% against the dollar to 7.0294.
The yuan is heading for the largest weekly gain since China revalued the currency in 2005, according to Refinitiv data, supported by expectations that China will abandon the zero Covid policy and anticipation of the US central bank slowing the pace of rate cuts.
The dollar fell 1 percent to 133.98 yen, its lowest level since August 16.
The euro saw little change and reached $1.0527, after rising 1.1% on Thursday.
The British pound fell 0.1% to $1.2260. It rose 1.7 percent on Thursday and reached a five-month high of $1.2311.
