Dollar down against euro, yen

NEW YORK (AP) -- The dollar sank against most major currencies on Friday, after oil prices rebounded from a brief decline and a private

NEW YORK (AP) -- The dollar sank against most major currencies on Friday, after oil prices rebounded from a brief decline and a private realty group reported that existing-home sales dropped for the eighth time in nine months.

The 15-nation euro rose to $1.5775 in late New York trading from $1.5699 late Thursday.

Oil prices rose again Friday, after tumbling around $4 overnight from a record above $135 a barrel set Thursday.

The euro-dollar trade has tracked the rise and fall of oil prices. Surging oil has weighed on the global economy, compounding inflation worries and fears that consumers will spend less as fuel takes up a larger part of their income. But the euro zone's economy is seen as more resilient to sky-high oil than the U.S. economy.

The British pound edged higher, to $1.9794 from $1.9782, after the U.K. reported its gross domestic product rose 0.4% in the first quarter of this year compared with the last quarter of 2007.

The dollar slumped to 104.17 Japanese yen from 105.26 yen, as U.S. stocks fell amid surging oil fears and steadily dropping home sales.

The dollar-yen trade tends to correlate with the stock market, as slumping equities drive currency investors from risky "carry trades."

Carry trades involve borrowing currencies from countries with low interest rates, such as Japan, and investing them in higher-yielding assets. When the market slides, traders tend to sell off those trades and pay back the yen loan.

Sales of existing U.S. homes fell by 1% in April to 4.89 million units, matching a record low set in January. It is the eighth drop in nine months. The National Association of Realtors, which tracks the data, starting collecting it in 1999. The median price for an existing home dropped 8% to $202,300, compared with the same time last year, and further price declines are expected.

In other New York trading, the dollar fell to 1.0241 Swiss francs from 1.0339 francs, but edged higher to 98.86 Canadian cents from 98.56 Canadian cents.