This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7270604.stm

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Dollar tumbles to new euro lows Dollar tumbles to new euro lows
(31 minutes later)
The dollar touched a new low against the euro for the fourth day in a row as worries continued about the outlook for the US economy. The dollar touched a new low against the euro for the fourth day in a row on continued US economic worries.
At one point the dollar touched 1.5239 against the euro as traders bet that US interest rates will be cut again. At one point the dollar touched 1.5239 against the euro as traders bet that US interest rates will be cut again after hints from US Fed chief Ben Bernanke.
That would make holding dollars, and assets priced in dollars, less attractive for investors who would look elsewhere for better rates of return.That would make holding dollars, and assets priced in dollars, less attractive for investors who would look elsewhere for better rates of return.
The pound also hit a record low against the euro of 76.54 pence. The British pound also hit a record low against the euro of 76.54 pence.
One-way dollar The pound also fell slightly against the dollar in early trade at $1.983, compared to its close on Thursday at $1.988.
Figures showing sagging house prices and downbeat consumer morale led to expectations that the Bank of England will be forced to lower interest rates below 5.25% at its next meeting. The only way forward for the dollar is down as recent ranges have been broken completely A trader at a European bank
Eurozone vs UK
Figures showing sagging house prices and deflating consumer morale out this week led to expectations that the Bank of England will be forced to lower interest rates below 5.25% soon.
"The pound is frustratingly soft at the moment, the market is quite downbeat on the UK and it is focusing on the bad news," said Geoff Kendrick, currency strategist at Westpac.
Meanwhile, the European Central Bank has so far maintained a tough line on the need to control inflation, which is running at 3.2% in the 15 nations that use the single currency.Meanwhile, the European Central Bank has so far maintained a tough line on the need to control inflation, which is running at 3.2% in the 15 nations that use the single currency.
Recent data showing encouraging retail sales and unemployment statistics in Germany, the region's largest economy, has also led to the view that eurozone rates will remain neutral at 4% for the time being. There have been encouraging reports on retail sales and unemployment in Germany recently.
That has reinforced the view that interest rates for countries that use the euro will remain at 4% for the time being.
One-way dollar?
The latest dollar weakness was sparked by confirmation that the US economy grew by 0.6% in the last three months of 2007.
There has also been a warning from the Federal Reserve chairman, Mr Bernanke, about the challenges the US central bank faces in tackling the threats of inflation and a cooling economy.
The US dollar also sank against other currencies, tumbling to almost three-year lows against the Japanese yen.
For the first time, a dollar now buys less than 105 yen.
"The only way forward for the dollar is down as recent ranges have been broken completely," said a senior trader at a European bank."The only way forward for the dollar is down as recent ranges have been broken completely," said a senior trader at a European bank.