Euro suffers ECB interest rate drop

Published: 12 Jun at 9 AM Tags: Euro, Dollar,

The euro is close to its lowest level against the dollar in nearly four months. Although up 0.1 per cent at $1.3544 the single currency is still not far off the four-month trough of $1.3503 plumbed this time last week. The euro has been hit by a European Central Bank decision to cut interest rates and push its deposit rate into negative territory.

A decision by the Reserve Bank of New Zealand to raise interest rates has helped boost the New Zealand dollar. The euro is at a 13-month low against the kiwi at NZ$1.5644. NZ interest rates now stand at 3.25 per cent.

Against the dollar the kiwi is up 1.1 per cent at $0.8640. The greenback has managed to remain steady against the yen at 102.11 yen. On Wednesday the dollar hit a one-week low against its Japanese rival of 101.86 yen.

The euro has managed to gain 0.1 per cent against the yen after hitting a four-month low on Wednesday of 137.88 yen. The single currency is currently worth 138.29 yen.

The Bank of Japan is holding a policy meeting at the moment, yet most analysts are predicting little effect on the yen. The central bank is likely to keep a steady monetary policy for the time being.