Dollar hits new euro low

LONDON: The dollar fell to a fresh record low against the European single currency on Monday before pulling back slightly ahead of key US data this week.   

The euro rose to an all-time high 1.4283 dollars in Asian trading.   

Later in European deals, the euro stood at 1.4239 dollars, compared with 1.4266 dollars in New York late on Friday.   

With the euro extending its recent record-breaking streak, traders will pay careful attention to remarks from top world finance chiefs at a Group of Seven meeting later this month to see if they try to talk up the dollar.   

The Australian dollar meanwhile pushed through the 89.00 US cent level Monday for the first time in 18 years, fuelling speculation it will reach parity with the greenback for the first time since it was floated.   

"Investors will stay bearish to the dollar in the short term if US data continues to disappoint," said Geoffrey Wu, a currency strategist at UBS.   

Focus this week is likely to be on Friday's US jobs report to see if last month's surprise fall in jobs is repeated.    

Traders were looking ahead to the US non-farm payrolls data for fresh leads on the impact of credit market and housing woes on the economy.   

"Although the market has already anticipated poor jobs data, traders are waiting for see if the Fed will reduce interest rates again," said Saburo Matsumoto, chief forex strategist at Sumitomo Trust Bank.   

The Fed last month slashed its key rate by 50 basis points to 4.75 percent. Many analysts expect further cuts to cushion the world's largest economy from problems stemming from the ailing US housing market.   

Soft US inflation figures released last week lifted expectations of another US rate cut later this month, dealers said.   

Meanwhile on Monday, a better-than-expected survey of Japanese business confidence was mildly positive for the yen.   

The Tankan survey showed business confidence among large manufacturers was stable at 23, close to December's two-year high of 25. A positive reading means confident firms outweigh the pessimistic ones.   

At the same time confidence fell among big non-manufacturers as well as smaller firms.   

In early European trading on Monday, the euro was changing hands at 1.4239 dollars, against 1.4266 dollars late on Friday, 164.55 yen (163.82), 0.6966 pounds (0.6968) and 1.6622 Swiss francs (1.6601).   

The dollar stood at 115.61 yen (114.80) and 1.1676 Swiss francs (1.1633).   

The pound was being traded at 2.0442 dollars (2.0470).   

On the London Bullion Market, the price of gold rose to 745.25 dollars per ounce at the morning fixing from 743.00 dollars late on Friday.