The Trump administration, already dogged by investigations into alleged Russian meddling in the U.S. election, took a fresh hit on Friday after White House spokesman Sean Spicer resigned, highlighting the upheaval within the president's inner circle, acccording to Reuters.
The dollar index, which tracks the greenback against six major currencies, was little changed at 93.887 , after touching 93.823, its lowest since June 2016.
"For any chance of the dollar bouncing back in the near term, it will need a rebound in U.S. yields," said Junichi Ishikawa, senior forex strategist at IG Securities in Tokyo.
"The current U.S. political situation is weighing heavily on U.S. yields. So we will need strong U.S. data to dislodge U.S. yields from their low levels," he said.
The benchmark 10-year U.S. Treasury note yield hit a three-week low on Friday, as a retreat on Wall Street kindled safe-haven demand for debt.
The euro was steady at $1.1668 after inching up earlier to a 23-month high of $1.1684.
The common currency's advance was limited after euro zone yields fell across the board on Friday, with the strong currency prompting investors to question the timing of the ECB's planned stimulus withdrawal.
The euro has been on strong footing this month after what the markets perceived as hawkish talk from ECB President Mario Draghi reinforced views that the central bank would begin moving away from its easy policy sooner rather than later. Neither did he express any concern at the currency's strength.
The dollar slipped 0.15 percent to 110.970 yen , with the Japanese currency at its strongest in roughly five weeks.
Speculators' bets on the U.S. dollar swung to a net short for the first time in more than a year, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday.
According to the same data, Japanese yen net shorts grew to their largest since January 2014.
Koji Fukaya, president at FPG Securities in Tokyo, said the high level of yen shorts probably reflected yen trades versus non-dollar currencies, so called cross trades.
"A lot of the selling pressure on the yen is channelled through cross yen pairs. That is why dollar/yen has been weak despite the large net short positions built up against the yen."
The Bank of Japan has stuck to its easy monetary policy while other major central banks have signalled shifts to normalising policy, which is why some investors have expected a weaker yen.
The Japanese currency stood in proximity of a 17-month low against the euro and a 19-month trough versus the Australian dollar.
The Australian dollar traded at $0.7923 after being pushed down from a 26-month high of $0.7992 scaled on Friday.
The Aussie had advanced on the dollar's broad weakness before its rally was tempered by dovish comments from Reserve Bank of Australia (RBA) deputy governor Guy Debelle on Friday.
The New Zealand dollar fared better, staying in close reach of $0.7460, its highest since September 2016 scaled on Friday.