Investing.com - The euro was at two year lows against the dollar on Thursday ahead of the European Central Bank’s monthly meeting later in the day, after recent weak economic data boosted expectations for more stimulus.
EUR/USD touched lows of 1.2295, the weakest since August 2012 and was last at 1.2301.
Persistently low levels of inflation and a faltering economic recovery have added to pressure on the ECB to step up measures to spur growth. The bank was expected to stop short of announcing quantitative easing measures but could extend its program of asset purchases
Surveys of euro zone private sector activity on Wednesday indicated that the region would post only marginal economic growth in the fourth quarter.
The composite index, which covers the manufacturing and service sectors across the currency bloc, fell to 51.1 last month from 52.1 in October.
Germany’s composite index dropped to a 17-month low, while the French composite index was at 47.9, well below the 50 level that separates expansion from contraction.
The single currency was steady against the yen, with EUR/JPY at 147.51.
Elsewhere, the dollar rose to fresh seven year highs against the yen. USD/JPY hit highs of 119.97 and was last up 0.09% to 119.90.
The yen has weakened broadly since the Bank of Japan unexpectedly expanded its stimulus program in late October.
In contrast, the Federal Reserve wound up its asset purchase program in October and is weighing whether or not the economy is strong enough to start raising interest rates next year.
The U.S. dollar index, which measures the greenback against a basket of six major currencies, was at 89.02, the strongest level since May 2010.