Dollar sinks to another euro low

The US dollar tumbled to a new euro low in early Asian trade as concerns over the state of the US economy deepened. 

The euro traded as high as $1.4348, breaking its last record set on Friday when one euro bought $1.4319. 

The sell-off was triggered on Friday by a profit warning from building equipment giant Caterpillar, prompting concerns over the slowing US economy. 

Analysts say the US Federal Reserve will have to cut rates again and this could weaken the dollar further. 

The greenback also slipped to a six-week low againt the Japanese yen, touching 113.25 yen at one point, and was trading at $2.0495 against the British pound. 

Suffering continues 

The latest falls come after a joint International Monetary Fund and World Bank meeting in Washington last Friday, which ended without any reference to the weakness of the US dollar or the strength of the 13-member Euro bloc's currency. 

Analysts say this apparent indifference suggests central bankers have no intention of interfering in this area of the currency market, a cue for investors to carry on selling dollars. 

They believe that the US Federal Reserve will have to cut interest rates further at this month's meeting from their current level of 4.75% to lift the economy, which is showing increasing signs of suffering from a slump in house prices and higher credit costs. 

At its September meeting, policymakers cut rates from 5.25% to 4.75%.