The greenback strengthened against 15 of its 16 major counterparts on Wednesday, pushing the single currency to a 10-month low after a rating downgrade for Portugal added to worries about debt levels and growth in the euro zone's smaller countries.

The Greek debt concern continued to haunt the single currency and reports were out just ahead of Asian opening showing short term speculators with a large German bank included gave the single currency a big bashing. The pair fell below 1.3443 in Asian mid-day. Later in Europe, better-than-expected German Ifo data came in at 98.1 in March versus the economists' forecast of 95.8 but this figure did not provide support to the pair. Euro's downward momentum accelerated in NY after renewed 'PIIG' worries emerged as Fitch Ratings downgraded Portugal's sovereign credit rating from AA to AA- with a 'negative' outlook. The nation’s gross domestic product per capita and trend growth are 'significantly below' what is typical for a AA country, Fitch said. The single currency eventually hit an 10-month low of 1.3312 in late NY afternoon.

The British pound remained under pressure on Wednesday as decline in euro dragged the price lower. Intra-day weakness picked up more momentum after U.K. finance minister Darling's comments. He stuck with his forecast of 1-1.5% GDP growth in 2010 but revised down his forecast for next year to 3-3.5% from 3.25-3.75% previously. Meanwhile, former Bank of England board member David Blanchflower said that if the U.K. lost its AAA credit rating, the market reaction to the downgrade might not be as “monumental” as some expect, and argued that the government should continue to support economy as the labor market remains weak. Despite this supporting news, cable tumbled to an intra-day low of 1.4855 in NY afternoon regardless.

The dollar has traded with a firm undertone versus the yen throughout the day on broad-based greenback strength and increased yields on U.S. government debt which fueled speculation the improving economy will allow the Federal Reserve to end stimulus measures. The pair surged from 90.35 in Australia to 92.42 in NY afternoon.

Economic data to be released on Thursday include: New Zealand GDP, Japan CSPI, Australia release financial report, Germany Gfk index, U.K. retail sales and U.S. jobless claims.