The euro tumbled in early Asian trade on Monday after Italian Prime Minister Matteo Renzi said he would resign after conceding defeat in a referendum over his plan to reform the Constitution.

The euro dropped 1.3 percent to $1.0505, falling below its 1 1/2-year low of $1.0518 touched late last month, and testing its key support levels where the currency has managed to rebound in the past couple of years.

A break below its 2015 March low of $1.0457 would send the currency to its lowest level since early 2003, opening a way for a test of $1, or parity against the dollar, a scenario which many market players now see as a real possibility.