The dollar fell to three-week lows against the euro today after the first estimate of US gross domestic product for the third quarter came in much weaker than expected, reinforcing the view US interest rates would not rise any time soon.
The euro later slipped to $1.2701, still up 0.1 per cent from late last night.
US GDP rose 1.6 per cent in the third quarter, the slowest rise in three years. Markets were expecting GDP growth of 2.2 per cent.
The core personal consumption expenditures price index, a key inflation measure, showed prices rose at a slower pace than in the previous quarter. "It points to a significant slowdown, but the market was short dollars going into it, as there was some speculation we'd get a soft number," said Shaun Osborne, chief currency strategist at TD Securities in Toronto.
"To a large degree, the market was prepared, but 1.6 percent is still pretty soft. Early in New York, the euro rose to a fresh three week-high against the dollar at $1.2724 from about $1.2690 before the data.