The euro touched the lowest in more than a decade versus the yenafter European governments signaled bondholders may have to takebigger losses on Greek debt, deepening concern the debt crisis willdamp recovery prospects.

The 17-nation currency reached an eight-month low versus thedollar as global stocks slumped. Russia's ruble fell for a fifthday versus the dollar on concern the euro-area debt crisis willhurt oil demand. The Australian dollar declined to the least inmore than a year versus the greenback after the Reserve Bank ofAustralia held its key rate at 4.75 percent.

“Central banks are now rebalancing their reserves and whereasearlier in the year that meant buying euros and non- dollarcurrencies, we're now in the reverse situation,” said Ray Attrill,a senior currency strategist at BNP Paribas SA in New York. “That'sprobably amplifying the pressures that are coming from safe-havenflows, which tend to support the dollar.”