* ECB unveils 60 billion euro a month QE program
* Euro hits over 11-year low against dollar, three-month low vs yen
* Danish central bank intervenes heavily to weaken crown (Updates prices, adds comments)
By Sam Forgione
NEW YORK, Jan 22 (Reuters) - The euro sank to a more than 11-year low against the dollar and a three-month low against the yen on Thursday after the European Central Bank launched a landmark bond-buying program that will pump up to one trillion euros into a sagging euro zone economy.
The ECB said it would buy government bonds from this March until the end of September 2016 despite opposition from Germany’s Bundesbank and concerns in Berlin that it could allow spendthrift euro zone members to slacken economic reforms. Together with existing schemes, the new program will pump 60 billion euros a month into the economy.
Investors sold the euro while traders who had made money betting against or ‘shorting’ it for six months in anticipation the ECB would act to fight deflation and revive the region’s economy added to those bets, sending the euro broadly lower.
“The ECB delivered,” said Chris Gaffney, senior market strategist at EverBank Wealth Management in St. Louis. “It’s a desperate attempt by the ECB to stimulate inflation.”
The euro moved closer to parity with the dollar, falling to its lowest since Sept. 2003 at $1.13340. The currency hit a three-month low against the yen of 134.28 yen and touched a nearly one-week low against the Swiss franc of 0.9843 franc.
Meanwhile, the euro hit a roughly seven-year low against sterling at 75.58 pence.
The ECB’s move underscored the divergence between the Federal Reserve’s path toward tighter U.S. monetary policy and looser policies in Europe and Japan, which has fuelled a rally in the dollar in recent months.
“From the perspective that the ECB has taken very significant steps, it may lead to broader dollar strength versus a number of European currencies,” said Aroop Chatterjee, currency strategist at Barclays in New York.
The greenback rose over 1 percent against the Swiss franc to as high as 0.87500 franc, marking the dollar’s first advance against the franc in three sessions.
Hours after the ECB decision, Denmark, whose crown is pegged to the euro, cut interest rates for the second time in a week to try to ward off upward pressure on the currency.
The dollar was last up 0.5 percent against the yen at 118.545 yen. The dollar index, which measures the greenback against a basket of six major currencies, hit over 11-year highs and was last up 1.61 percent at 94.399. (Reporting by Sam Forgione; Additional reporting by London markets team; Editing by Diane Craft and James Dalgleish)