12 January 2004, 10:56  Dollar weak in Europe, hits life low vs euro

LONDON, Jan 12 - Broad dollar weakness continued in early European trade on Monday, pushing the greenback to fresh record lows against the euro and 11-year lows on sterling, although the U.S. currency was supported against the yen. Markets were looking forward to the 1200 GMT news briefing by European Central Bank President Jean-Claude Trichet, who is meeting other world central bankers at a Bank of International Settlements summit in Basel, Switzerland. Investors are keen for any signals about the ECB's views of the strong euro. There was little major data due out of the euro zone on Monday but two manufacturing reports were scheduled out of the United States in New York trading hours. Asian trading had been subdued because of a holiday in Japan but investors were still wary of potential official intervention to support the dollar and prevent sharp weakening of the yen. By 0750 GMT the dollar had fallen to as low as $1.2870 per euro , its lowest level since the single currency's launch five year ago. It also fell to $1.8504 against sterling, its weakest since September 1992. Rampant dollar selling has been driven largely by worries over the current account deficit in the United States and expectations that U.S. interest rates will remain low for some time. On Friday, it was also accelerated by a disappointing jobs report from the U.S. The Federal Reserve Bank of Kansas City releases its December manufacturing survey at 1600 GMT, while the Fed's Bank of Chicago releases its manufacturing index for November at 1700 GMT.//

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