Dollar at record low

The dollar fell to a record low versus the euro early on Tuesday after the Federal Reserve cut its key interest rate. Policy-makers reduced the benchmark lending rate between banks by the most since November 2002 to 4.75 percent, the lowest level since May last year.
It was the first rate cut in four years. The Fed also lowered the discount rate it charges for direct loans to banks by a half-point. Traders sold the dollar as lower rates make US dollar-denominated assets less attractive. Financial markets had widely expected the Fed to lower overnight borrowing costs by at least 25 basis points, but were split over whether the move would be a more aggressive half-point.
Against the dollar, the euro was 0.7 percent higher to trade at $1.3962, after earlier trading at a record high of $1.3977. The dollar pared some of its early gains against the yen to trade at 115.70 yen. The dollar fell nearly 1 percent against the Canadian dollar to trade at 1.0164, a 30-year low. The high-yielding New Zealand dollar also rose 2 percent to $0.7205, while the Australian dollar was up 1.8 percent at $0.8490.