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Expectations are growing that the European central bank will cut interest rates further when it meets this week.
The euro's losses were dragged down further by news of a possible downgrading of Spain's top AAA rating by Stand and Poor, reports Reuters.
Masaki Fukui, a senior market economist at Mizuho Corporate Bank: "Concerns about the sustainability of the economic impact from stimulus plans and the growing fiscal burden worldwide are surfacing after hopes about government spending dominated the market last week."
In late trading yesterday (January 12th), the euro fell by 0.7 per cent against the dollar and 0.6 per cent against the Japanese yen.
In related news, economics expert and Daily Telegraph writer Alex Singleton has joined those calling for the UK to forget about joining the euro in the future and instead bring back the gold standard.
