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Speculation is growing that the ECB will cut interest rates to an all-time low of 1.5 per cent, down from the current level of two per cent.
Daragh Mager, deputy head of global Forex strategy at Calyon, commented: "With revised ECB staff forecasts set to reflect both the weaker GDP outlook and more benign inflation, the euro looks set to remain on a weakening trend over the coming months."
Meanwhile, the dollar continued to trade strongly - fuelled by concerns about the global recession - surging to a four-month high against the yen, reports Reuters.
After jumping four per cent in yesterday's session, European shares were set to open lower today as a result of falling crude oil and metal prices.
