Euro's Slide Continues

The euro slipped against the dollar on Wednesday, a day after a top European Central Bank official jolted markets by saying the bank's bond-buying program would be stepped up ahead of an expected summer liquidity lull.

The bloc's single currency fell 0.5% in early trade, hitting a two-week low of below $1.11 after declining more than 1% on Tuesday.

"In just over a week we have round-tripped from $1.11 to well over $1.14 and back, and the fun and games might not be over yet," strategists at Rabobank wrote in a note.

The dollar also hit a two-month high against Japan's yen, helped by better-than-expected U.S. housing starts data for April released Tuesday.

European government bonds and equity markets were broadly steady on Wednesday after soaring Tuesday.

In early trade, the Stoxx Europe 600 added 0.2%. Companies that sell the bulk of their goods beyond the currency area tend to especially benefit from a weak euro.

The common currency is now trading close to 8.5% lower against the dollar so far this year, and the Stoxx Europe 600 has added more than 18% over the same period. The S&P 500 in the U.S. has risen just over 3% so far this year.

In Asia on Wednesday, Tokyo stocks finished at a 15-year high after data showed Japan's economy grew at its fastest pace in a year during the first quarter.

In commodities, Brent crude was trading 1% higher on the day at $64.68, while gold edged 0.1% lower to $1,205.20.

Write to Josie Cox at [e-mail]

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