The dollar tumbled to fresh lows on Wednesday, as the day's mixed bag of US economic data failed to provide any respite and Wall Street headed into Thursday's Thanksgiving holiday.
The dollar hit another all-time low against the euro, a nine-year low against the Swiss franc and a 4½-year low against the yen.
A below-consensus University of Michigan consumer sentiment reading and weaker-than-expected durable goods figures outweighed a bigger-than-expected fall in new jobless claims last week, compounding negative sentiment towards the US currency.
James Barty at Deutsche Bank said that while Europeans had been complaining about the brutality of the dollar's decline, the line from Federal Reserve chairman Alan Greenspan last week seemed to be that the dollar's fall was a logical consequence of the burgeoning US current account deficit.
"The question for asset allocators is more one of how far and how fast the dollar decline will come."
Mr Barty noted that a fortnight ago, the bank had trimmed some of its dollar short, as positions looked extended and sentiment poor. "That looks a little early in hindsight, since while the euro's appreciation does seem to have slowed, the Asians have taken up the running. Nevertheless we would probably pull the rest of the short were the euro and yen to approach 1.35 and 100 respectively," he said.
However, David Rosenberg at Merrill Lynch said a consensus had emerged that Mr Greenspan had talked the dollar down last Friday.
"That simply is not true . . . read the speech," he told clients. "Foreign exchange policy doesn't even come under the Fed's purview, and if you in fact believe he was delivering a forecast on the dollar, keep in mind that he is in the process right now of revising another forecast - his view that we would see 5 per cent-plus GDP growth in the second half of this year. Not even Maestro is infallible when it comes to predicting the future."
On Wall Street, the Dow Jones Industrial Average edged higher at midsession as weekly data showed crude oil inventories rose in line with expectations last week, sending US light oil down 74 cents to $48.20 a barrel.
At current prices, crude oil has risen 50 per cent since the start of the year but is almost $7 below all-time highs reached last month. Nymex crude for January delivery ended the day 50 cents higher at $49.44 after an unexpectedly sharp fall in natural gas stockpiles.
By the close, the Dow was 0.3 per cent higher while the Nasdaq Composite jumped 0.9 per cent.
European stocks gave up any hopes of staging an advance as the US data proved disappointing and fresh record highs for the euro hit export-driven sectors. The FTSE Eurotop 300 index edged 0.1 per cent lower.
Asian markets gained ground on expectations for strong corporate earnings, sending an MSCI index of Asia, outside Japan, to their best levels for almost five years. Tokyo's Nikkei 225 Average gained 0.2 per cent.