The euro slipped against the dollar on Thursday as weaker global shares stifled appetite for higher-risk currencies, prompting investors to book profits on the single currency's rally to a two-month high.

Lingering concerns about the effectiveness of an EU rescue fund for euro zone countries struggling with debt problems also helped to keep sentiment negative for the euro on Thursday.

In early European trade, the euro slipped 0.2 percent on the day to the day's low of $1.3420, retreating from $1.3539 hit on Wednesday, its strongest since late November. It later trimmed losses to trade around $1.3470, unchanged on the day.

Market participants said investors remained long of dollars despite the euro's rally in the past week or so, which resulted in natural demand to sell dollars before the end of the month. Analysts added that a slide in U.S. Treasury yields was helping to keep a lid on demand for the U.S. currency, and that it could come under selling pressure in the near term.