The dollar slipped to a new record low against the euro on Thursday in partly technically driven action after a mixed batch of US economic reports gave traders enough reason to sell the already weakened currency. The euro pushed to a new record high of $1.3506 after a report showed that while US durable goods orders were strong overall in November, much of the gain was in the volatile transportation industry. The euro zone currency gained more ground on the dollar on news that US new home sales tumbled 12 percent in November.

Other economic data were more favourable. The University of Michigan consumer sentiment index rose to 97.1 in December from 92.8 in November, more than the 95.7 predicted by analysts.

But the confidence index was ignored. Richard Franulovich, senior currency strategist at Westpac Banking Corp in New York, said the euro's rise to new highs would bode well for the currency's continued gains in 2005.

"It gives the dollar bears the upper hand going into the New Year," he said. Franulovich expects the euro will rise to $1.40 during the first quarter.

By mid-afternoon in New York, the euro was trading at $1.3491, up 0.8 percent in the session but below its new record high of $1.3506, according to Reuters data.

The dollar was off 0.5 percent against the yen at 103.70, and down 0.8 percent versus the Swiss franc at 1.1441. It also was off 0.6 percent against the Canadian dollar at 1.2334 after firming for several days. Sterling rose 0.4 percent against the dollar to $1.9212. But it fell to its lowest level against the euro in nearly a year to 0.7040 per euro before trimming losses to 0.7020.

Copyright Reuters, 2004