NEW YORK - THE dollar was mixed against other currencies on Thursday as stocks rose following a report of contraction in the US economy that was less than analysts had expected.

The 15-nation euro rose to US$1.29 (S$1.89) late on Thursday trading in New York from $1.2852 late on Wednesday, while the British pound rose to US$1.6444 from US$1.6314.

European currencies, sensitive to 'risk appetite,' have traded higher as stock markets saw some gains this week.

'We've had such wild gyrations that it is really hard to get a read on the key factors that are driving (the dollar). There's been so much intensity of demand for dollars overall,' said Mr David Watt, senior currency strategist at RBC Capital in Toronto.

'The retreat we've had over the last couple days was almost a relief.'

Stocks traded higher, with the Dow Jones industrials closing up nearly 190 points, after the Commerce Department said gross domestic product fell at a yearly rate of 0.3 per cent in the third quarter.

In the April-June period, the economy had grown by 2.8 per cent.

But the decline was smaller than had been predicted.

Meanwhile, the dollar rose to 98.48 yen (S$1.47) from 97.14 yen, and edged higher to 1.1376 francs (S$1.46) from 1.1367 francs.

The yen's value has shot up over the past few weeks - hitting a 13-year high last week - as worried investors curtailed their overseas positions amid intense market volatility, paying up the yen loans they had used to fund bets in emerging markets.

The soaring yen prompted calls for currency intervention and an interest-rate cut by the Bank of Japan.

Cutting interest rates can lower a currency's value as investors look for better returns elsewhere.

The Swiss franc, like the dollar, also saw 'safe-haven' flows as investors looked to transfer their money somewhere more stable.

In other New York trading, the dollar slipped to 1.2133 Canadian dollars (S$1.37) from C$1.2262 late on Wednesday.

'The market still needs US dollars. Every time we get near a key event or day you're going to see US dollar buying,' Mr Watt said. -- AP