The dollar fell against major currencies on Friday after a report showed that U.S. economy contracted less than expected in the second quarter.

The pace of decline in real GDP decelerated substantially in the second quarter to 1.0 percent from 5.5 percent in the first quarter, according to the U.S. Commerce Department. Most analysts have expected a decline of 1.5 percent.

But the report also showed some negative signs that the U.S. economic recession was deeper than previously estimated. The economic growth rate of 2008 was revised down from 1.1 percent to 0.4 percent.

With the exception of federal government spending, all the major components of real GDP were revised downward for 2008. In particular, personal consumption expenditures were revised down to show a drop of 0.2 percent in 2008 instead of an increase of 0.2 percent.

The Commerce Department also reported that U.S. personal consumption expenditures fell by 1.2 percent in the second quarter, worse than expected. Personal consumer spending accounts for two-thirds of U.S. economic activities.

The euro bought US$1.4250 in late New York trading compared with US$1.4078 it bought late Thursday. The pound rose to US$1.6686 from US$1.6489.

The dollar fell to CA$1.0789 from CA$1.0830, and fell to CHF1.0689 from CHF1.0880. It fell to JPY94.79 from JPY 95.60.

(Xinhua News Agency August 1, 2009)