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Forex - Euro little changed before ECB meeting

Published 04/21/2016, 05:31 AM
© Reuters.  Euro little changed before ECB meeting
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Investing.com - The euro was steady against the dollar and the yen on Thursday as traders looked ahead to a European Central Bank meeting later in the day, at which no fresh policy measures were expected.

EUR/USD was at 1.1286, well below the highs of 1.1387 set on Wednesday. EUR/JPY eased to 123.95.

The ECB was widely expected to keep interest rates unchanged at record lows after unveiling a raft of new measures last month, including interest rate cuts, additional monthly bond purchases and more cheap loans to banks.

But the euro rallied in the wake of that meeting after ECB chief Mario Draghi indicated that further rate cuts may not be necessary.

Draghi was expected to react to criticism of ultra-loose monetary policy from German officials.

German Finance Minister Wolfgang Schaeuble has said that negative interest rates are hurting Germany’s banking system and are in part to blame for the rise of the right-wing anti-immigration party Alternative for Germany.

The ECB has eased policy aggressively, cutting rates deeper into negative territory and expanding its asset purchase program in a bid to spur price growth in the euro area.

The euro was also steady against the pound, with EUR/GBP at 0.7873.

In the U.K. data on Thursday showed that retail sales fell in March while government borrowing rose more than forecast.

The weak data added to indications that economic growth slowed in the first quarter.

Sterling was almost unchanged against the dollar following the data, with GBP/USD at 1.4339.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady at 94.55.

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