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It lost 1.2 per cent against the Swiss franc by 07:40 BST as American politicians failed to agree how much the country's debt ceiling should be raised to, reported Bloomberg Businessweek.
Barack Obama is facing a stalemate between Republicans and Democrats regarding the issue, although the vast majority of analysts are certain that their differences will be resolved before the nation is forced to default on its debts.
In an interview with the newswire, currency strategist at Bank of Tokyo-Mitsubishi UFJ Lee Hardman suggested the dollar could continue to struggle.
"The main driver is concern over whether the US authorities will eventually reach an agreement over raising the debt ceiling," he added.
According to the US Treasury, Obama has until August 2nd 2011 to resolve the problem, as that is when it will run out of money.
Posted by Clive Arneil
