The dollar came under renewed pressure today as the euro took advantage of lingering concerns about the health of the US recovery and soared above the $1.26 level for the first time in eight months.
The single European currency in late-day trade was at $1.2613 against $1.2514 late yesterday evening in New York.
A weakening Wall Street performance deepened the gloom surrounding the dollar, which has been on the back foot for some time now in the wake of disappointing US economic data.
Analysts said today's movements reflected broad dollar weakness. Markets have been slowly bidding the dollar down, mostly using the structural issues facing the currency as an excuse. Many observers believe the dollar is likely to fall further now that the euro has broken through a new trading range.
The pound was also higher against the dollar but in less convincing fashion than the euro after minutes from the Bank of England's last rate setting deliberations revealed a dovish stance.
What surprised the market was not the fact that the nine-member panel voted unanimously to keep its key repo rate unchanged at 4.75% in October but that the possibility of another quarter point hike was not even discussed.
As a result, the euro rose to its highest level since early January against the pound, at £0.6968, but then retreated slightly.
