The euro hit $1.30 today for the first time in 18 months as the US currency fell against all major currencies.
Buoyed by signs of solid euro zone economic growth and likely higher interest rates, the euro rose by more than 1 per cent against the dollar.
The euro had risen yesterday after a strong German business sentiment survey strengthened expectations the interest rates would continue to rise.
Prospects of a slowdown in the US economy and potentially lower US interest rates have combined with concerns about fundamental economic imbalances to put the dollar under pressure.
However, if the current decline lasts, a soaring euro could lower the horizon for European Central Bank interest rate hikes, changing the dynamics.
Britain's pound was up 0.8 per cent at a near two-year high above $1.93, and the dollar was 1 per cent lower against the Swiss franc, and down a third of a percent against the yen at 115.9 yen.