The euro fell to its weakest in almost nine years against the dollar amid speculation the European Central Bank is moving closer to large-scale bond purchases.

The shared currency slid as much as 1.2 percent after President Mario Draghi last week gave his clearest signal the ECB will start quantitative easing. The euro also weakened as Greece began an election campaign that may see victory by an anti-austerity party. A gauge of the dollar headed for its highest ever close as the federal reserve moves toward raising interest rates. New Zealand's dollar and South Africa's rand led losses in commodity currencies.

“The reasons to be selling the euro were pretty clear over the weekend: Draghi being a step closer to QE and deepening concerns about the Greek political situation,” said Sean Callow, a currency strategist at Westpac Banking Corp. in Sydney. “The euro was so close to such a keenly watched round number as $1.20 that we didn't need any fresh news to tip us over the cliff.”

The euro dropped 0.5 percent to $1.1942 as of 1:55 p.m. in Tokyo after sliding to $1.1864, the lowest level since March 2006. The shared currency fell 0.5 percent to 143.93 yen after declining to 143.16, the lowest since Nov. 11. The dollar was little changed at 120.54 yen.

Draghi, in an interview with German newspaper Handelsblatt published Jan. 2, said policy makers are ready to act if needed to counter deflation. The ECB meets on Jan. 22.

The euro has fallen 0.4 percent in the past week, the third worst performer of 10-developed nation currencies. The dollar gained 1.5 percent and the yen rose 1.6 percent.