The surprise decision by the European Central Bank to cut interest rates means there’s now about an even chance that the euro, this year’s best-performing major currency, will erase all of its gains in a matter of months.
The euro fell the most in two years versus the dollar after the European Central Bank unexpectedly cut its main refinancing rate to a record-low 0.25 percent to boost growth in the 17-member currency region.
The dollar traded at almost the weakest level in two years versus the euro after U.S. consumer sentiment fell to a 10-month low, adding to bets the economy is struggling and the Federal Reserve will delay cutting stimulus.
The euro fell for a fifth day against the dollar as signs of economic weakness in the single-currency bloc fueled speculation the European Central Bank will cut interest rates as soon as at its meeting next week.
The euro slid the most in more than a year versus the dollar as weaker-than-forecast economic data for the currency region fueled speculation the European Central Bank will cut interest rates as soon as at its meeting next week.
The dollar fell to an eight-month low against a basket of 10 major currencies on bets disruption from the U.S. debt-ceiling debate will damp growth and prompt the Federal Reserve to postpone tapering its stimulus program.
The dollar had its first back-to- back weekly losses against the euro in a month as weaker-than- forecast economic data added to bets the Federal Reserve will put off slowing stimulus to help the U.S. economy strengthen.
Washington’s wrangling over a partial government shutdown and lifting the U.S.’s borrowing limit has strategists cutting their forecasts for the dollar for a third straight month, the longest stretch this year.