Greenback plunges after Federal Reserve slashes discount rate at emergency meeting.
The dollar nose-dived to its lowest levels in 12 1/2 years Monday in Asia, falling below 96 yen as the Federal Reserve's rate cut failed to calm market fears about more U.S. bank writedowns.
The Fed on Sunday cut its discount rate, or its lending rate to financial institutions, by a quarter point to 3.25%.
The move only managed to give a temporary lift to the U.S. currency before it began its steep decline.
"The Fed's action is needed but it leaves the current main market problems unresolved, and there seems to be nothing that can stop this [dollar-selling] flow for now," said Masafumi Yamamoto, head of foreign exchange strategy at Royal Bank of Scotland.
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