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Euro lower against dollar on single-family homes dip; no ECB guidance on future rate moves

Euro lower against dollar on single-family homes dip; no ECB guidance on future rate moves

The euro drifted lower against the U.S. dollar in European trading Tuesday after a speech by the head of the European Central Bank offered no hints about interest rates in the euro zone.
In midmorning European trading, the 15-nation euro bought US$1.4798, slipping lower from the US$1.4825 it bought late Monday in New York after a report showed that the pace of sales of existing U.S. homes fell to its lowest level since 1999.
Sales of single-family homes and condominiums fell by 0.4 percent in January, and the median price for a home slid for the fifth consecutive month, the National Association of Realtors said Monday.
But it was a lack of guidance by ECB President Jean-Claude Trichet on Monday about the bank's interest rate, which has sat unmoved at 4 percent since last summer, that drove the euro down.
Instead, Trichet warned that an economic slowdown in one area of the world would not go unnoticed elsewhere.
"We are in a universe of interdependence," he said at the New Year's Reception Asia-Pacific 2008 in Frankfurt.
The lack of comment about the 15-nation euro zone pushed the common currency lower, said Gary Thomson of CMC Markets.
"There is some speculation that rates may now be held steady in the coming months and although this has the potential to lift the common currency, the general theme of Trichet's comments last night revolved around the growing importance of emerging economies in averting the current slowdown _ something that will be difficult to engage with if the home currency is trading at a premium."
The dollar fell against the Japanese yen, to purchase 108.01 yen, from 108.07 yen Monday.
The British pound edged higher to US$1.9669 from US$1.9667 on Monday.


Updated : 2021-04-18 22:45 GMT+08:00