The
dollar slid to a record low against the euro on Wednesday as global
investors bet that the Federal Reserve will cut interest rates to lift
global markets out of the current turmoil linked to the subprime
mortgage losses.
Any hike by Bernanke
& Co. will narrow the interest rate gap between the US and Europe.
Late on Tuesday, short-term interest rate futures signaled a perceived
67% chance of a 50-basis point cut in the fed funds target rate at the
US central bank's Sept. 18 policy-setting meeting.
The US currency
declined for a sixth day, the longest losing streak since April, after
the National Association of Realtors yesterday cut its home sales
forecast, stoking concern that the housing slump is spreading to other
parts of the US economy.
The dollar fell to
US$1.3887 per euro by 7:53 a.m. in New York, after earlier declining to
an all-time low of US$1.3889. That compares with the previous low of
US$1.3852 on July 24. The US currency is down more than 7% from its
highest point this year, reached Jan. 12.
The dollar also slipped
to 113.83 yen from 114.27 yesterday, on speculation that Japanese
investors will cut riskier overseas bond holdings after Prime Minister
Shinzo Abe said he will resign.
The dollar slumped to the lowest in more than a month versus the British pound and was recently little changed at US$2.0318.
Against the Canadian
dollar, the US currency held near the lowest since the end of July, at
96.13 US cents. It fell to the lowest since August 1995 versus
Denmark's krone. | 
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