The dollar slumped on Tuesday as profit warnings in the US rekindled concerns over consumer confidence, the housing market and subprime mortgage issues.

The euro hit a record high of $1.3740 after Home Depot, the US do-it-yourself retailer, cited weakness in the US housing market for cutting its earnings forecasts for the year. Meanwhile, DR Horton, the country’s second-largest homebuilder, added to the housing market gloom, saying sales orders in its third quarter fell 40 per cent.