Euro tests low last seen at its birth in 1999

Five Euro Note

The euro hit a fresh nine-year low against the U.S. dollar on Thursday, taking it close to its starting point in 1999 when the currency was launched in 11 European countries.

The single currency fell as low as $1.17625 on Thursday, its lowest since December 2005 and dangerously close to the $1.1747 level at which it traded at its launch in January 16 years ago.

Read More Euro slide could take it to parity with dollar

The decline came as more weak economic data from the euro zone piqued hopes the European Central Bank (ECB) will implement further aggressive stimulus measures after it meets this month.

German factory orders data on Thursday morning showed a sharp monthly fall in November, with new orders down 2.4 percent. This, coupled with the consistent rise in the dollar, pushed the bloc's currency lower.

Meanwhile, data from the euro zone on Wednesday showed the currency union's inflation rate fell into negative territory in December for the first time since 2009, adding to pressure on the ECB to launch a U.S. Federal-Reserve-style bond-buying program.

"Market participants seem to believe yesterday's 'flash' estimate, that euro zone consumer prices had fallen 0.2 percent in the year to December, raises the chances that the ECB will resort to full-blown QE at its meeting on 22 January," said chief economist at ADM ISI, Stephen Lewis.

"In truth, the figures were probably no surprise to members of the ECB's Policy Council, who have been talking for several weeks past about the pending impact on consumer prices of the sliding oil market."

When the euro was launched it became the currency of 11 euro zone member states, replacing old national currencies including the German Deutschmark and the French franc. It is now used by 19 countries.

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