The euro fell to fresh two-week lows against the dollar as the US currency was boosted by indications that the legal battle over the presidential election was favouring Mr George W. Bush. The single currency was trading last night at $0.8485, down almost one cent from the day's high and 0.4 per cent from the previous close.

The euro was also weakened by news that core inflation in the euro zone edged higher in October although headline CPI slowed. The euro zone's harmonised consumer price index rose by 2.7 per cent year-on-year in October from 2.8 per cent the previous month, while inflation excluding food and energy prices advanced to 1.5 per cent from 1.4 per cent. But the headline figure, well above the ECB's target rate of 2 per cent, did not prompt fears of an interest rate rise.