The dollar sank to its lowest point in a year Tuesday against several currencies ahead of a meeting by of the Federal Reserve on interest rates and the Group of 20 summit in Pittsburgh this weekend.
The 16-nation euro broke past $1.48 for the first time since September 2008, rising as high as $1.4821 before settling back to $1.4776 in morning trading in New York. On Monday, the euro was worth $1.4677.
The British pound gained to $1.6360 from $1.6194, while the dollar slid to 91.12 Japanese yen from 92.13 late Monday in New York.
The dollar also dropped to its lowest point since last September against an index that tracks six major currencies.
Traders have been ditching the dollar for other currencies as signals point to an economic recovery and since the Group of 20 finance officials recently pledged to maintain government spending, low interest rates and increased money supply to shore up the global economy.
Those moves should help boost economic activity and liquidity in financial markets, increasing investors' appetite for assets around the world at the expense of the dollar.
The Federal Reserve is also expected to keep the federal funds rate at a range near zero when it announces its decision Wednesday.
Investors will be looking to the G-20 meeting in Pittsburgh this week for more indications on where the economy is headed.
The dollar's drop may reflect market thoughts that dollar weakness isn't going to "cause excessive concern" at the summit, wrote UBS analysts in a research note.
"The case for intervention seems weak," according to Brown Brothers Harriman currency strategists in New York.
In other trading in New York, the greenback hit its lowest point since July 2008 against the Swiss franc, at 1.0212, before edging back up to 1.0244 Swiss francs. On Monday, the dollar was worth 1.0327 Swiss francs. The dollar also dropped to 1.0723 Canadian dollars from 1.0778.
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AP Business Writer George Frey contributed to this report from Frankfurt, Germany.
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