The US dollar slumped to a new all-time low against the euro today as the European currency rose above $1.30 for the first time.
The move came after figures showed the US trade deficit was above $50bn for the fourth straight month.
The 12-nation currency hit $1.3007 after the release of the trade figures, breaking its previous record of $1.2987 set on Monday amid concerns about oil prices and the US trade and budget deficits.
The euro’s recent rally has seen it surge from about $1.20 two months ago, prompting European Central Bank President Jean-Claude Trichet to call the rise “brutal” earlier this week.
In Washington, the Commerce Department reported today that the trade deficit shrank to $51.6bn in September, better than expected by many but still high due to the sharp rise in oil prices.