ECB council member’s comments send euro lower

Comments from a member of the European Central Bank’s council that carried the implication that the ECB could cut interest rates this year sent the euro into decline in relation to the US dollar Wednesday.

The comments, from Bank council member Yves Mersch referenced the slowdown in the US economy, soaring oil prices and other issues in contending that downward pressures to the Eurozone economy be more important than the threat of inflation in decisions on monetary policy by the ECB.

The euro fell from a near record high versus the US dollar on Tuesday to trade at $1.4640 in morning trade in New York Wednesday before trading at $1.4651 to the shared currency early in the afternoon.

The euro also dropped against the yen, to ¥157.4230 to the euro at just before 1 p.m. in New York.

The US dollar gained on the yen after falling to ¥105.29 to the dollar in early trade, falling below ¥106 to the dollar for the first time in almost two and a half years.

In early afternoon trade in New York, the yen traded at ¥107.4450 to the dollar.

However, the dollar touched a new record low versus the Swiss franc, with the franc trading at SFr1.1005 to the dollar at early afternoon in New York.

The pound was stronger versus the euro and traded little changed against the US dollar, trading at 74.67p to the euro while the dollar traded at $1.9621 to the pound in New York.

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