LONDON, Dec 29 - The euro powered to fresh record highs against the dollar on Monday, rising above the psychological $1.25 level, as short term traders capitalised on a holiday-thinned market to give the dollar a further beating. The euro rose more than half a percent to $1.2511 in the European midsession, bringing its gains since the start of the year to more than 19 percent. The dollar has been under broad-based pressure in recent months as investors have fretted about the United States' ability to fund its current account deficit, currently running at some five percent of gross domestic product. "The market remains thin so moves are exaggerated but you can't get away from the underlying problems that are surrounding the dollar, particularly the current account deficit," said Paul Robson, international economist at Bank One. The dollar also touched an 11-year low against sterling and came within sight of last week's seven-year low against the Swiss franc .//