The euro fell to its lowest level in a week against the dollar on Wednesday, heading towards its minimum level this year, weighed down by expectations of easing monetary policy and investor preference for the dollar.
Analysts say the single currency is unlikely to recover in the short term ahead of next week's ECB meeting when policy makers are likely to unveil plans for a new monetary stimulus.
The euro was steady at $ 1.1212 but earlier tumbled to $ 1.1200, its lowest level since July 9. The euro has fallen 2.2% since the beginning of the year against the dollar, trading between $ 1.15 and $ 1.11.
Sterling fell to a 27-month low of $ 1.2382 on a combination of concerns about Britain's exit from the EU without a deal and the dollar's overall rise. The British currency hit a six-month low against the euro at 90.51 pence.
The dollar rose yesterday after strong US retail sales exceeded expectations in June, dampening expectations that the Federal Reserve may cut interest rates by 50 basis points instead of 25 basis points in its monetary policy review by the end of the month.
The dollar index, which tracks the performance of the greenback versus a basket of six currencies, rose to a one-week high of 97.44 earlier, but the index fell slightly and settled in the latest trading at 97.
LONDON (Reuters)