The dollar slumped to a fresh record low against the euro and below 100 yen Thursday on mounting fears of a US recession, driving gold to an all-time high of 997.10 dollars an ounce, dealers said.
The European single currency struck a record-high 1.5625 dollars, while the dollar slid to 99.78 yen -- the lowest point since November 1995.
"This is a market that is focused on risk more than return and sentiment remains significantly negative that the market is wary about taking on board excessive risk," said Commonwealth Bank economist Divyang Shah.
After reaching a new peak, the euro stood at 1.5593 dollars, from 1.5540 late on Wednesday in New York.
The dollar was trading at 100.20 yen, from 101.79 late Wednesday.
As the US currency tumbled, investors seeking safe havens pushed oil and gold to fresh historic highs, while the Swiss franc was close to parity with the dollar.
The US unit remained on the backfoot despite Tuesday's move by the US Federal Reserve to inject 200 billion dollars into money markets aimed at easing the global credit crunch.
A troubled fund backed by US private equity giant Carlyle said it expected its creditors to seize its remaining assets after failing to strike a deal on its financing.
"As suspected dollar gains were limited following the Fed's auction announcement," said Commerzbank analyst Gavin Friend.
"For the dollar, investors are becoming increasingly alert to the unfavorable mix of negative data, rising inflation expectations and the possibility of a deeper and longer lasting (US) recession," he added.
Many analysts now expect the Fed to cut its key lending rate by as much as 75 basis points next week. Investors generally prefer the currencies of countries that have higher interest rates as they can reap better yields.
The greenback's slide is being watched with growing nervousness in Japan amid concern that a stronger yen could derail the economy's export-led recovery.
US President George W. Bush said the weakness of the dollar was "not good tidings" and that he backed a stronger US currency.
But the remarks fell on deaf ears in the market, where many players believe that Washington is comfortable with a weaker dollar because it helps exporters.
"The dollar is totally out of market favour now," said Kenichi Yumoto, vice president of foreign exchange sales at Societe Generale in Tokyo.
In European trading Thursday, the euro jumped to 1.5593 dollars against 1.5540 late on Wednesday, at 156.27 yen (158.22), 0.7655 pounds (0.7667) and 1.5708 Swiss francs (1.5778).
The dollar stood at 100.20 yen (101.79) and 1.0076 Swiss francs (1.0150).
The pound was at 2.0369 dollars (2.0267).
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