Dollar at two-month euro low
The dollar fell to a two-month low against the euro in Thursday trading as the Chinese central bank announced plans to diversify its $1 trillion foreign exchange reserve.
The dollar fell 0.3 per cent over the day to $1.2856 and 0.4 per cent against the yen to trade at 117.40 yen. The dollar also hit six-week lows on the Swiss franc at F1.2385.
It remained unclear if the announcement by the governor of China's central bank Zhou Xiaochuan meant a large-scale selling of dollar assets.
"There's a sort of dollar weakness bias in the market at the moment especially given the China diversification story," Luke Waddington of Royal Bank of Scotland told Reuters.
The dollar was also under pressure after an expression of concern by the Bank of Japan over a sharp unwinding of carry trades.
The euro has benefited from widespread predictions that the European Central Bank will continue to raise rates from the current 3.25 per cent.