Euro skirts with record high, pound hits 26-year peak

The euro climbed close to its record high against the dollar on Tuesday while the pound hit a 26-year peak against the US currency on worries over the US housing market and interest-rate differentials, dealers said.The dollar was pressured by doubts the Federal Reserve would hike US interest rates again in the near future, amid jitters about international security after a series of failed car bombings in Britain.Traders said the pound was surging against the dollar as dealers looked to a likely interest rate hike in Britain this week.The pound rose to 2.0197 dollars in early European trade-the highest level since 1981. It later stood at 2.0166 dollars.The euro climbed during the day to 1.3638 dollars, close to the record high of 1.3682 reached on April 27.It ended the day at 1.3614 dollars however, down from 1.3623 in New York late on Monday.The dollar inched up to 122.42 yen from 122.39 late on Monday in New York."The main story here is a rallying sterling, with the pound boosted by the prospect of a BoE rate hike later this week-and obviously unfazed by the terror alert," said CIBC economist Audrey Childe-Freeman.

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As in the days of Noah....