Euro touches eight-month low, European shares fall

The euro hit an eight-month trough against the dollar on Wednesday and German bond yields were at record lows ahead of inflation data expected to boost the case for further European Central Bank policy easing. Investors were also awaiting a statement from the Federal Reserve following its policy meeting that some expect to signal a more hawkish policy outlook, and data likely to show the U.S. economy bouncing back strongly in the second quarter. European shares dipped after French oil major Total (TOTF.PA) was hit by concerns over its investments in Russia following Tuesday's tightening of European sanctions on Moscow after the downing of an airliner in neighboring Ukraine. Traders said that if German inflation data, due at 1200 GMT (8.00 a.m. EDT), also came in below forecast, it would intensify pressure on the ECB to print money to support growth and avert deflation risks.

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