The euro hit another record high against the US dollar this afternoon as more bad news on the US economy piled up.
The euro hit a high of $1.5135, breaching the $1.51 barrier for the first time since its creation in 1999.
This year, the dollar has tumbled against the euro and most other currencies amid growing fears that the US housing market crisis and the consequent global credit crunch could push the world's biggest economy into recession.
This afternoon, there were weak figures on new home sales and durable goods orders.
In addition, favourable interest rate differences and record high oil prices have encouraged currency investors to channel more funds into the euro. The US Federal Reserve has slashed rates since September and is expected to make another cut next month.
EU Economic and Monetary Affairs Commissioner Joaquin Almunia has said extreme volatility on foreign exchange markets is unwelcome.
Speaking in Brussels, Almunia hinted that there was little that policy-makers could do about the European currency's strength, saying: 'The exchange rate of the euro is the product of supply and demand forces.'
