The euro weakened against the dollar, set for its firstback-to-back annual decline versus the greenback since 2001, onconcern Europe's debt crisis will weigh on the region's economicgrowth.

The 17-nation currency fell for a sixth day against the yen, itslongest losing streak in a year, before a report next week thateconomists said will confirm European manufacturing shrank for afifth month. The Australian and New Zealand dollars rose as stocksgained before reports forecast to show the U.S. economy isrecovering. China's yuan climbed to a 17-year high on signs thecentral bank favors the currency's appreciation to prevent capitaloutflows.

“The euro is weaker as the focus is very much on Europe,” saidPeter Rosenstreich, chief currency analyst at Swissquote Bank SA inGeneva. “The backdrop is still the euro-zone debt crisis andconcerns about growth. The dark clouds are getting darker. We'reseeing a death by a thousand cuts.”