Euro Runs to New High

The euro hit another all-time high against the dollar overnight on growing concerns the mortgage mess will force the Federal Reserve to cut interest rates.

Euros traded as high as $1.4855 earlier in the session before pulling back to $1.4823 recently. That was still up from $1.4812 late Tuesday. The CurrencyShares Euro Trust(FXC Quote) was barely changed in recent market action.

"Every day we seem to get some new piece of bad news," says Meg Browne, senior currency strategist at Brown Brothers Harriman in New York. "Yesterday it was Freddie Mac(FRE Quote)," which reported a $2 billion loss.

Dealers fear the Fed may try to stem the continuing fallout from the housing slump by lowering the cost of borrowing again.

Elsewhere the Japanese yen was gaining on the dollar, with one dollar selling for 108.65 yen vs. 109.89 yen in the last session. The British pound would buy $2.0566, down from $2.066 previously.