The European Central Bank has left interest rates unchanged at the record low level of 0.5% sending the Euro downward against the British Pound and US Dollar.
The interest rate decision was widely expected by the markets with more interest being focused on the press conference held by ECB President Mario Draghi who signalled that Bank officials are keeping a close eye on rising money rates. The increasing rates are of concern as investors worry that borrowing costs will remain low.
In his press conference Draghi tried to convince the markets that he will keep interest rates low for the foreseeable future in an attempt to bolster the Eurozone’s tentative recovery. Investors have raised their bets for a rate rise which Draghi hit back against saying that the calls were unwarranted.
“We will remain particularly attentive to the implications that these developments may have to the stance of monetary policy,” Draghi said at his monthly press conference in Frankfurt today. “I’m very, very cautious about the recovery. The shoots are still very green.”
After Draghi’s speech the Euro fell further against Sterling to trade in the region of 0.84p and against the US Dollar it fell to 1.31.
The ECB also weighed upon the single currency by trimming its forecast for the Eurozones growth prospects next year. It cut its forecast from 1.1% to 1.0% and said that the region’s economy will contract by 0.4% this year, slightly less than the 0.6% predicted three months ago.
Euro (EUR) Exchange Rates
As of 14:45 pm
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3183
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8448
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4432
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6761