The euro hit a record high against the dollar this morning as the dollar languished after soft US data and weak earnings.
The single currency climbed to $1.4320 according to electronic trading platform EBS, and the growing view for lower US rates also drove the dollar to a record low versus a basket of major currencies and a three-week low against the yen.
A slide in Asian equities offered a broad boost to the yen, as it pointed to an ebbing of risk appetite and encouraged unwinding of risky bets against the low-yielding Japanese currency.
As traders braced for a meeting of Group of Seven finance ministers in Washington later today, a nearly 2 per cent slump in the Nikkei share average helped the yen gain a leg up on the dollar and high-yielding currencies.
The dollar index, which measures the dollar's performance against a basket of major currencies, dipped to a record low around 77.406.
The yen gained broadly versus high yielders, with the euro falling 0.4 per cent to 164.50 yen.
Bank of America reported a much larger than expected 32 per cent drop in quarterly profit on yesterday on the back of mounting credit losses, fanning concerns that a global credit squeeze is far from over.