New York, Feb 14: The dollar clawed back from early losses on Friday in volatile trade amid a wave of profit-taking in the euro after the single European currency hit a near-record high against the greenback. Earlier, the US currency fell sharply against its major counterparts on a report that the US trade deficit widened sharply and a surprisingly weak consumer sentiment survey. Markets were also perturbed by rumours of intervention by the European Central Bank after the euro fell a full cent in less than half an hour, reversing gains posted after the softer-than-expected US data. Traders said the intervention rumours were fuelled by the sale of some 2 billion euros by a big European bank, a move that accelerated losses in the single European currency. Traders, however, were unable to confirm the ECB's presence in the market. "The market may well have been spoofed by the intervention rumours, but the end result is still some pretty ugly short-term price action for the euro," said Shaun Osborne, chief currency strategist at Scotia Capital in Toronto. "Friday's session will likely qualify as a key reversal day and failed retest of the prior high, setting the market up for a minor correction at least of the past week's rally," he added. In late afternoon trade in New York, the euro was down 0.5 percent at USD 1.2737. The dollar was up slightly at 105.52 yen and rose 0.6 percent to 1.2384 Swiss francs. Sterling was down 0.37 percent at USD 1.8845 after touching an 11-year high of USD 1.8978. Analysts, however, remain bullish on the euro and are likely to buy the currency again on some dips. Next week should provide ample opportunity to renew positions on the euro amid another heavy economic calendar, traders said, with the release of US industrial production and capacity utilisation, the February Philadelphia Fed survey and consumer price data. Bureau Report