LONDON, Dec 23: The euro gained slightly against the dollar on Tuesday in muted trading ahead of the Christmas break, with dealers largely shrugging off US data confirming negative economic growth in the third quarter.

In late afternoon trading the euro was changing hands for $1.3959 compared to $1.3944 in New York late on Monday. The euro also gained against the yen, rising to 126.10 yen compared to 125.79 yen on Monday.

The dollar rose against the yen to 90.57 yen, up from 90.25 on Monday.

“As the year draws to an end... everyone is prepared to sit on their hands, do very little and prepare for what will hopefully be a better 2009,” said Stuart Bennett from French investment bank Calyon.

Currency markets were closed on Tuesday in Tokyo and will be working half-days in Europe and the United States on Wednesday. Markets will be closed everywhere on Thursday and closed again in London on Friday.

The British pound was trading close to record lows against the euro, without however reaching the record low of 1.0463 euros from last week.—AFP