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Last Updated: Friday, 23 May, 2003, 12:06 GMT 13:06 UK
Euro exceeds its launch value
The euro has punched through its launch value against the dollar and is soaring toward an all-time high.

By 1200 GMT the European single currency was worth $1.1789, up more than a US cent against the dollar.

That value was easily in excess of the $1.1747 rate at which the euro closed on its launch day four years ago.

And it puts the currency within a whisker of its all-time high, achieved during that first day's trading.

US deficit

The euro has been steadily gaining ground against the US dollar since March last year.

But it has dramatically picked up pace in recent months and last week briefly touched its launch value, before falling back.

America's ballooning current account deficit and sluggish economy have created the conditions for a weakening currency.

At the same time, a strong dollar is not thought to be a top priority for new US Treasury Secretary John Snow.


Shahab Jalinoos, currency strategist at UBS Warburg, said: "It's natural at this point for the market to try and test the all-time high in euro/dollar.

"We're seeing all-time highs in euro/yen almost daily, so technically the momentum is there for euro/dollar to keep going up as well."

The euro hit fresh record highs against the yen, and its highest since August 2001 against the Swiss franc.

The BBC's Hywel Jones
"The strong euro is beginning to bite"

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