LONDON, July 19: The dollar sagged against other leading currencies on Friday, hit by another round of bloodletting on Wall Street, concerns over accounting standards and some less-than-robust earnings reports.

Economists said the dollar could also be undermined by the latest estimate of the US trade deficit later Friday after a record figure last month pounded the US unit.

The single European currency rose to 1.0148 dollars from 1.0112 late on Thursday in New York. In Asian trading overnight, the euro-zone unit rose as high as 1.0190 dollars.

The dollar eased to 116.01 yen from 116.52 on Thursday.

The currency markets continued to take their cue from equities, which were expected to head south again on Friday after some disappointing earnings reports and outlooks from the likes of US software giant Microsoft overnight.

ABN Amro economist Rob Haywood said the Microsoft figures were expected to drag US equities into loss when trading began on Friday, which was sapping at the dollar.

There has been renewed concerns about the financial market repercussions from recent accounting scandals, while escalating Mid-East tensions are also weighing on the dollar, he added.

The latest company to fall foul of accounting concerns was America Online (AOL) after the Washington Post reported the company may have boosted advertising revenue between 2000 and 2002 through a series of what the paper called “unconventional” deals.

Commerzbank economist Nick Parsons said that the daily correlation between the euro-dollar exchange rate and the performance of the Dow Jones US blue-chip share index has been been as high as 88 per cent over the past four months.

But he said that equities were not the only factor influencing the dollar and the US trade figures would therefore be closely watched.

In a world where capital is scarce and being destroyed by the day, the current account deficit matters, he said.

Just as companies with stretched balance sheets and high borrowings are being punished relative to their peers, so too are currencies, he wrote in a research note.

He said it was no coincidence that the currencies with the highest current account surpluses, such as the yen, euro, Swiss francs and Norwegian kroner, were among the best performing currencies while the dollar with the biggest current account deficit was at the bottom.

The euro was changing hands at 1.0148 dollars against 1.0112 on Thursday, 117.66 yen (117.85), 0.6417 pounds (0.6426) and 1.4635 Swiss francs (1.4647).

The dollar was being quoted at 116.01 yen (116.82) and 1.4428 Swiss francs (1.4482).

The pound was at 1.5819 dollars (1.5727), 183.43 yen (183.31) and 2.2808 Swiss francs (2.2781).

London Bullion Market, an ounce of gold stood at $318.75 against 317.65 on Thursday.—AFP