Euro under pressure for rate cuts
Posted on June 21st, 2005 by Brian Turner
The euro reacted badly to the news of a larger than expected interest cut from Sweden, and to the increased talk the rate cut triggered that the European Central Bank might follow suit and cut eurozone interest rates soon.
Bad consumer purchasing data from France added to the speculation.
Despite the insistence of ECB officials that there is no consideration being made to change interest rates in either direction and that the current rate of 2 percent is “appropriate”, the euro fell in relation to the US dollar, sterling and the yen.
The shared currency fell 0.1 percent to $1.2137 in relation to the dollar, lost 0.2 percent to sterling, to £0.6640, and declined 0.9 percent to ¥131.70 against the yen.
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