The U.S. dollar fell to a record low compared to the euro on Wednesday, with each euro costing $1.30.

The currency markets were reacting to a government report showing the U.S. trade deficit was the third-highest in history ($51.6 billion) in September.

The deficit measures the amount that imports to the United States exceeded American exports.  However, U.S. exports still rose to a record level.

A separate government report showed that the number of Americans requesting unemployment compensation for the first time increased slightly last week (by 2,000 to a total of 333,000).

Later today, the U.S. central bank is expected to raise its key interest rate a quarter of a point in a bid to fend off future inflation. 

Some information for this report provided by AFP, AP and Reuters.