The euro hit record highs against the dollar today.
The euro rose as high as $1.4766 and was up 0.6 per cent on the day. It gained 1.35 per cent versus the yen, to 110.56 yen.
The dollar was down half a per cent against a basket of six major currencies earlier this morning at 75.435.
Adding to dollar weakness was continued speculation that Gulf countries may be preparing to ditch their dollar pegs or at least revalue their currencies.
Traders also cited speculation of an imminent US interest rate cut, perhaps later today, when the Fed publishes the minutes of a policy meeting and gives more detailed economic forecasts.
The US central bank has already lowered its fed funds rate by a total of 75 basis points at its last two meetings to 4.50 per cent.
With the softer economic outlook and prospects for more rate cuts set to weigh on the dollar for some time, countries that are pegged to it are facing problems such as inflation.