But currency analysts said the number was better than the 3 to 4 percent decline that the market had been expecting.
The net effect will be to make the dollar less attractive to foreign investors, currency analysts say.
Several currency analysts expressed surprise that the dollar did not fall further after the latest economic reports.
Now, as 2006 approaches, currency analysts again predict dollar weakness.
In the view of most market participants and currency analysts, however, it has not.
More important, some currency analysts think that the euro's worst days are behind it.
The bank's currency analysts estimate that the dollar needs to fall an additional 10 to 15 percent before it can be considered fairly valued.
How do currency analysts predict it will perform post- election?
He began his career as a currency analyst at Rothschild.
Still, many currency analysts are confident about their forecasts that the euro's value will rise to $1 by the end of the year.