LONDON, Feb 12: The euro fell against the dollar on Thursday on expectations of a lower European Central Bank interest rates and new data showing a record fall in factory output in the recession-hit eurozone.

In late afternoon trading on London currency markets, the euro dropped to $1.2842 compared to $1.2904 late on Wednesday. The European single currency was stable against the yen at 116.68 yen compared to 116.65 yen.

“Eurozone economic indicators confirm an economy that is going from bad to worse,” said Audrey Childe-Freeman at US bank Brown Brothers Harriman.

“Concerns about a worse than expected global economic downturn haven’t been lost on the euro where the EU officials are struggling to put together a financial rescue plan,” she said.

The dollar meanwhile gained against the yen -- rising to 90.56 yen against 90.39 yen late Wednesday -- following an earlier drop that dealers blamed on continuing uncertainty over efforts to revive the ailing US economy.

On the London Bullion Market, the price of gold increased to $943.25 an ounce from $938 late on Wednesday.—AFP