The dollar has experienced modest weakness against its major rivals in U.S. trading on Friday as traders mulled over a gross domestic report that fell short of analyst expectations. Meanwhile, traders anxiously awaited the verdict on Greece's plan voluntarily restructuring its sovereign debt.

A Commerce Department report showed that the U.S. GDP increased at an annual rate of 2.8 percent in the fourth quarter compared to the 1.8 percent growth seen in the third quarter. Economists had been expecting an increase of about 3.1 percent.

The greenback moved lower against the euro to 1.3207, extending a five-week low. The buck hit as low as 1.3221, its weakest level since Dec. 21. The buck has continued to slide against the European currency since hitting a 17-month best of 1.2623 last week.

Against the British pound, the greenback has slipped to 1.5721 and the dollar saw a more notable drop to 76.7342 against the Japanese yen. The greenback slipped to 0.9133 against the Swiss franc and hovered just above parity at 1.0019 against Canada's loonie.

Fitch downgraded Spain's long-term Issuer Default Rating to 'A' from 'AA-', Italy's to 'A-' from 'A+', Belgium's to 'AA' from 'AA+', Cyprus' to 'BBB-' from 'BBB' and Slovenia's to 'A' from 'AA-'.

Meanwhile, in the U.S., a report from Reuters and the University of Michigan showed that the consumer sentiment index for January was upwardly revised to a reading of 75.0 from the mid-month reading of 74.0.