(RTTNews) - The dollar was mostly weaker for a fourth day versus other major currencies on Friday, with traders questioning the validity of data showing that personal income and spending rose more than expected last month.

Personal income showed a substantial increase in the month of May, according to a report released by the Commerce Department on Friday, although the increase was largely due to the rebates sent out as part of the government's economic stimulus plan.

The report showed that personal income surged up 1.9 percent in May following an upwardly revised 0.3 percent increase in April.

However, the bigger than expected increase in personal income was largely due to the $48.1 billion in rebate payments issued by the government during the month. Excluding the rebate payments, personal income increased by only 0.4 percent.

Consumer sentiment fell to another 28-year low in June, signaling that US Americans remain deeply pessimistic about the economy. The Reuters/University of Michigan Consumer Sentiment Index came in at 56.4, a slightly worse-than-expected result.

The dollar drifted lower against the euro, hitting a 3-week low of 1.5781 in early dealing before stabilizing. Traders reacted to a slew of economic data from the EU, including a report showing that Eurozone economic sentiment deteriorated significantly and touched the lowest level in more than three years.

The dollar also fell sharply versus the sterling and yen, but rebounded from early losses against its Canadian counterpart.

The greenback plunged to a 3-week low of 105.97 versus the yen, having dropped from a range near 108 over the past two sessions. With global stocks coming under heavy selling pressure, risk averse traders flocked to the safer, lower yielding yen.

Versus the surging sterling, the dollar plummeted to a 2-month low of 1.9950, down from an early high of 1.98. Trading took place as the Office of National Statistics revealed that the UK economy grew 0.3% in the first quarter of 2008 after picking up 0.6% in the previous quarter.

The dollar managed to claw back its early losses versus the loonie, and even pushed slightly ahead for the day. After dropping to a monthly low of 1.0050, the dollar rallied back to 1.0115.

Friday morning, Statistics Canada released its report on Canadian industrial product and raw materials prices in the month of May, showing that the pace of price growth slowed substantially compared to the previous month.

The report showed that industrial product prices rose 0.6 percent in May following a 1.6 percent increase in April. The price growth was primarily due to an increase in petroleum and coal products prices, which rose 8.2 percent.

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