The euro fell for a third day versus the dollar amid concerns that the European debt crisis will hamper economic growth in the region.
The dollar extended gains against the euro today after US durables goods orders rose more than expected in April.
The euro dipped to $1.2277 against the dollar, down 0.7 per cent on the day, from about $1.2305 previously. It closed at $1.2345 yesterday.
Europe's shared currency dropped 0.5 per cent to 110.79 yen, from 111.39. It slid to 108.84 yen yesterday, the least since November 2001.
The dollar fetched 90.25 yen, from 90.23.
Bookings for durable goods rose 2.9 per cent in April, the Commerce Department said today in Washington. The according median estimate of 77 economists was for a gain of 1.3 per cent.
An index of German consumer confidence fell to 3.5 points in June, while French spending on manufactured goods dropped 1.2 per cent in April from March.
"There is growing concern about the likely downdraft on economic activity in the second half of 2010, especially in Europe as deficit cutting measures bite," Mitul Kotecha, head of global currency strategy at Credit Agricole CIB in Hong Kong, wrote in a note to clients today. "The euro is set to remain under pressure."
The euro has lost over 7 per cent against the dollar so far this month and is heading for its biggest monthly fall since January 2009. Investors generally flock to the yen and the US dollar when risk aversion and volatility spikes.
The Bank of Spain said on Saturday it had taken over a small savings bank, CajaSur. Analysts said the move highlighted weakness in the European banking sector and heightened worries that more banks in the euro zone may need to be bailed out. That is likely to see more investors fleeing the euro.
Data suggests the recent sell-off in growth-linked currencies is likely to run further.
Bloomberg, Reuters