The euro continued its rapid climb to new highs against the dollar on Friday, hitting $1.5238 in early European trading.The dollar has been plagued by uncertainty about the course of the U.S. economy even after U.S. Federal Reserve Bank Chairman Ben Bernanke said Thursday that the American economy was not "anywhere near" the dangerous situation of the 1970s. With the economy slowing and inflation rising, fears have grown that the country could be headed for the dreaded twin evils of stagnant growth and rising prices known as stagflation.

The euro's peak Friday was above the previous record of $1.5229 that it reached on Thursday.

In midmorning trading, the euro subsided slightly to $1.5203 from the $1.5215 it bought in late New York trading Thursday.



"The dollar looks set to finish the month with yet more downside pressure being heaped upon it," said Gary Thomson of CMC Markets in London.

The British pound fell to $1.9871 from $1.9926. The dollar dipped to 104.39 Japanese yen from 105.36 yen in New York the night before.

The euro topped $1.50 for the first time since its 1999 introduction early Wednesday, then surged above $1.51 after markets took comments from Bernanke as a sign that yet more U.S. rate cuts are on the way.

Lower interest rates can jump-start a nation's economy, but can weigh on its currency as traders transfer funds to countries where they can earn higher returns.