The dollar hit new record lows against the euro and a basket of currencies on Thursday amid a growing belief that the U.S. Federal Reserve will cut interest rates again next month.

Adding to downward pressure on the dollar was a recovery in equity markets and a slight pick up in risk appetite which made investors more willing to put on riskier trades in high-yielding or emerging market currencies.

The more risk-friendly mood also hit the yen, a favorite source of cheap funding for the carry trades. The Japanese currency eased from the previous day's 2-1/2 year peaks versus the dollar, while high-yielding Australia and New Zealand units gained broadly.

With the United States marking the Thanksgiving holiday on Thursday and Japan shut on Friday, volumes were likely to remain subdued into the end of the week, potentially exacerbating market volatility.

The euro hit a record high of $1.4873, bringing its year-to-date gains to around 12.5 percent. It also set fresh all-time highs against the ECB's trade-weighted basket of 24 currencies at 111.77.