Euro Slides Against Dollar

The euro slid against the dollar on Tuesday as many traders took profits after the European single currency soared close to a one-month peak on the back of positive Chinese data, dealers said.

In London morning deals, the euro fell to 1.4497 dollars, from 1.4514 late in New York on Monday, when it struck 1.4557 -- a level which was last seen December 16.

Against the Japanese unit, the dollar dropped to 91.69 yen from 92.13 yen on Monday.

"The euro was unable to defend yesterday's gains and once again fell below the 1.45-dollar mark," said Commerzbank analyst Antje Praefcke in a research note to clients.

"The negative factors for the greenback -- US budget deficit, fears of inflation -- are increasingly losing importance as it is becoming obvious that they are unfounded or as they are no longer seen as a reason supporting euro/dollar as similar problems exist in the eurozone," Praefcke added.

Market players in Tokyo, returning to work after a three-day weekend, were unimpressed with last week's US labour market report, dealers said.

The US economy lost 85,000 jobs in December, official data showed Friday, dampening hopes for a return to positive employment growth that could lead to a hike in US interest rates and support the greenback.

"The dollar is set to maintain a weak tone into the rest of the week and will continue to be driven by the gyrations in risk appetite," predicted Calyon analyst Mitul Kotecha.

The euro had jumped close to a one-month peak against the dollar on Monday, as robust Chinese data boosted risk sentiment.

The shared European unit, which is seen as a higher-risk currency than the dollar and tends to rise with investor confidence, won ground after weekend data revealed soaring Chinese exports.

China's exports surged 17.7 percent in December to snap a 13-month falling streak, the government said Sunday, confirming the Asian power's new status as the world's biggest exporter.

Later this week, the European Central Bank will announce the outcome of its latest monetary policy meeting.

The ECB was widely expected to keep its key interest rate at a record low 1.0 percent on Thursday, with the focus on eurozone economic prospects and how the Greek debt crisis plays out, analysts said.

In London on Tuesday, the euro was changing hands at 1.4497 dollars against 1.4514 dollars late on Monday, 132.91 yen (133.71), 0.8981 pounds (0.9007) and 1.4759 Swiss francs (1.4747).