LONDON, Dec 30: The euro climbed higher against the dollar here on Thursday, approaching record levels, following the publication of weak industrial activity data in the United States.

The single European currency in late-day trade was at $1.3625, against $1.3606 late Wednesday in New York. The euro at one point shot up to $1.3639, coming close to its record level of $1.3648 set on Wednesday.

The dollar was meanwhile trading at 103.11 yen after 103.79 on Wednesday. The greenback suffered against the euro following publication of the latest Chicago Purchasing Managers index, which showed that business in the Chicago region expanded at a slower pace in December and hiring contracted.

The main PMI index dropped to 61.2 from 65.2 in November, below market expectations for a reading of around 63.1. Significantly, the employment sub-index fell from its strongest reading in a decade in November to show contraction to 49.1 in December, an initial indication that next week's key US payrolls numbers could disappoint.

The euro failed to break new ground however, and Maher noted that $1.3650 remains a key level for the single currency. A failure to break through that mark could trigger some profit-taking into the New Year, he said.

Elsewhere, the yen moved back up after dropping earlier in the day and on Wednesday on fears that the Bank of Japan could take advantage of the quiet holiday period to intervene in the foreign exchange market to weaken its currency.

The pound strengthened slightly against the dollar but remained weak against the euro after the release of more downbeat news on the British housing market. Recent weak British economic data and - in particular - last week's dovish set of minutes from the last meeting of the Bank of England's Monetary Policy Committee have led many in the market to believe that the next interest rate move could well be downward.

On the London Bullion Market, the price of an ounce of gold stood at $435.60 against $440.25 on Wednesday morning. -AFP