Euro slumps to 2003 dollar low on Fed rate outlook

The euro tumbled Thursday to a near 14-year dollar low against the dollar, one day after the US Federal Reserve lifted interest rates and signalled three more hikes for next year.

Shortly after midday, the European single currency tanked to $1.0405, which was the lowest level since January 2003.

"Investors who were expecting the final weeks of trading before Christmas to conclude on a quiet note received a shocker on Wednesday following the firmly hawkish (Fed) meeting which sent shockwaves across the financial markets," said research analyst Lukman Otunuga at trading firm FXTM.

"Although it was widely expected that US interest rates would be increased by 0.25 percent amid stronger economic growth, the aggressive hiking path for 2017 ... sent the greenback to fresh 14 year (euro) highs."