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22-May-17
16:40
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Euro sells off to record low; dollar hits high

The euro fell on Thursday below $ 1.10 for the first time since 2003 and the U.S. dollar added to gains against an index of currencies after the European Central Bank said it will next week launch a massive bond-buying program meant to boost economic growth.

The euro zone common currency, which has lost about 15 percent against the dollar in six months, briefly traded under $ 1.10 for the first time since September 2003 and hit a session low of $ 1.0988.

It is also on track for a third consecutive weekly loss against the greenback. The euro is also on track for its ninth consecutive monthly loss against the dollar, which has never happened before. February also marked the eighth loss in a row for the euro. Before then, the longest monthly losing streak for the euro vs the dollar was seven months, according to FactSet.

It was last off near 0.50 percent at $ 1.10265 in selling that accelerated after a news conference by ECB chief Mario Draghi.

Draghi spoke after the ECB, in its battle against euro zone economic sluggishness and low inflation, pushed up its 2015 and 2016 growth forecasts and fixed a March 9 start date for bond purchases of 60 billion euros a month.

Read MoreWeak euro boosts euro zone businesses

Analysts have suggested the ECB would distort the bond market by buying bonds with negative yields. Draghi said it would only steer clear of bonds yielding less than the ECB’s -0.2 percent deposit rate.

“Some people are interpreting some of the comments by Mario Draghi as very dovish for the euro,” said Thierry Albert Wizman, global interest rates and currencies strategist at Macquarie in New York. “That’s why we broke through some stops and got down to about 1.10.”

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