The U.S. dollar declined versus the euro Friday after the Labor Department's monthly payrolls report showed the economy lost fewer jobs in April than some economists anticipated, feeding more willingness among investors to take risks and sell the U.S. currency. The euro rose to the highest since mid-March -- $1.3502 -- from $1.3396 in late North American trading Thursday. The dollar index , a measure of the greenback against a basket of currencies, traded at 83.239, compared to 83.758 Thursday. The dollar bought 99.21 Japanese yen, from 99.23 yen late Thursday. The U.S. currency also fell versus the Canadian dollar, after Canada reported its economy surprisingly added jobs last month. The U.S. dollar bought C$1.156 loonie, down 1.2%. U.S. stocks took the data positively, adding to relief after results of bank stress tests released late Thursday showed the banking sector is secure. The Standard & Poor's 500 Index recently traded up by 1.9%. "There is continuing acceptance of risk in some asset markets as people look through the report and latch into more tenuous signs of improvement," said Christopher Sullivan, chief investment officer at United Nations Federal Credit Union. "It's hard to see the dollar appreciating." The government said the U.S. economy lost 539,000 jobs in April, less than economists expected. The report also said the unemployment rates rose to the highest in 26 years - 8.9% -- from 8.5%, matching forecasts. The previous two month's losses were revised higher. See more on jobs report. "The string of encouraging economic and financial news this week have helped ease market tensions about taking risk and supporting foreign currencies at the dollar's expense even when US data are upbeat," said strategists at Brown Brothers Harriman.

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