In mid-afternoon trade, the European single currency jumped to 1.4950 dollars, very close to the record of 1.4967 hit on November 23.

It later stood at 1.4913 dollars, up from 1.4857 in late New York trade on Thursday.

Meanwhile the dollar also fell to 105.91 yen from 106.44 yen.

The US economy experienced a decline in employment in January for the first time since August of 2003 in a fresh sign of trouble, the US Labor Department said Friday.

The loss of jobs caught the market off guard as most economists had anticipated a gain of 70,000 in January.

This week, the euro has moved higher against the dollar due to ongoing fears of a recession in the United States, the world's largest economy.

"January's employment report doesn't decisively solve the question of whether the US economy is in, or headed for, a recession," said Paul Ashworth, analyst at Capital Economics.

"But the surprisingly weak 17,000 decline in non-farm payrolls last month suggests that the odds of a recession may now be more than 50/50 and that the (US central bank) was right to act so aggressively in cutting interest rates by 125 basis points in the past two weeks."