Forex - Euro Hits Day’s Lows after ECB, Dollar Pushes Higher

26 July 2018, 11: 53
© Reuters.  Euro hits day’s lows after ECB, dollar pushes higher

The euro fell to the lowest levels of the day Thursday after European Central Bank President Mario Draghi reiterated rates will remain on hold until summer 2019, highlighting the widening monetary policy divergence with the Federal Reserve.

EUR/USD was down 0.47% to 1.1671 by 10:20 AM ET (14:20 GMT), off a session high of 1.1744.

Draghi said the euro area economy still needs "significant monetary policy stimulus," despite announcing plans last month to wind up the bank’s quantitative easing program at the end of the year.

Draghi said it is "too early" to assess the impact of the agreement between Europe and the U.S. to cooperate on trade, but said it was a good sign.

Draghi also noted that uncertainty surrounding the inflation outlook is receding and said risks to the growth outlook remain broadly balanced.

The comments came after the ECB left interest rates on hold at the conclusion of its latest policy setting meeting, in what was a widely anticipated decision.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.4% to 94.37.

The dollar edged higher against the yen, with USD/JPY inching up 0.12% to 111.11.

On the economic front, data on Thursday showed that initial jobless claims rose last week, climbing from a more than 48-1/2-year low, but remained at levels indicative of a tightening labor market.

Separate reports showed that durable goods orders rose last month, while the U.S. trade deficit widened as exports declined.

The pound was lower against the firmer dollar, with GBP/USD down 0.39% to 1.3136.