The US dollar has recovered from session lows of 117.75 yen, while the euro fell slightly from around $1.255 to $1.245.
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Previously, the powered to a seven-year peak just shy of 119 yen on Thursday after Federal Reserve minutes suggested the United States is still likely to raise interest rates next year, in stark contrast to Japan's ultra-loose policy outlook.
The euro slipped after purchasing managers' surveys from the euro zone showed business growth was weaker than forecasters expected this month, underpinning expectations that monetary conditions will be eased further in the 18-nation bloc.
The dollar romped as far as 118.98 , its highest since August 2007. The greenback last traded at 118.63 yen, 0.6 percent higher on the day and up around 9 percent since the Bank of Japan sprang a surprise expansion of its stimulus programme on the market just three weeks ago.
Currencies
"From the start of next week I think that there'll be a concerted focus on 120 yen," said Neil Mellor, a currency strategist at Bank of New York Mellon in London, adding that with no technical barriers in the way, the dollar could hit that level as soon as the middle of next week.
Even the struggling managed to hit a six-year high against the Japanese currency of 149.120 yen, though it pared most of the day's gains after the euro zone data and was last trading at 148.49 yen.
The dollar had a brief hiccup on Wednesday as investors digested the Fed minutes, which struck a more cautious tone than the central bank's post-meeting statement last month.
But they also showed Fed members were relatively unconcerned about the dollar's strength.
"The Fed has left the green light shining brightly for further dollar gains," said Alan Ruskin, global head of currency strategy at Deutsche Bank.
Later on Thursday, the dollar could take its cues from a batch of U.S. economic data, including the consumer price index and jobless claims.
The euro fell to as low as $1.2505 after the euro zone data and was last trading at $1.25085, down 0.4 percent on the day.
—By Reuters