Forex - Euro reversed gains after less hawkish interest rate remarks from ECB officials
The Euro made its biggest drop against the Dollar in the past three weeks on Wednesday as Euro zone PMI dropped to an almost three-year low in April. Another report showed German manufacturing activity also declined. Demand for the European currency slid further after comments by a member of European Central Bank Governing Council, Christian Noyer, put down speculation of further interest rate increases by the bank.
The ECB is expected to keep its key interest rate on hold at 4%, while the US Federal Reserve is expected to lower its benchmark from 2.25% later this month. The Euro?s record hig on Tuesday was boosted by hawkish remarks from ECB’s Noyer’s that the central bank will do what is needed to being inflation back to target.
A slide in British mortgage approvals to a record low in March underlined serious weakness in the housing market and suggested the Bank of England may continue cutting rates. The data wiped out initial sterling gains made on BoE minutes showing there was d