Euro Trades Near Three-Month Low Before ECB Meeting, Pound Drops

The euro traded 0.1 percent from the lowest in almost three months amid speculation European Central Bank President Mario Draghi and his policy board will revise down their economic outlook and signal monetary easing today.

The pound dropped to the lowest since July 2010 before the Bank of England meets. Poland’s central bank unexpectedly cut its main interest rate to a record low yesterday amid Europe’s debt crisis. The dollar was near the highest level since May 2010 versus the yen before data tomorrow forecast to show U.S. companies added more workers in February.

“The euro and sterling are heavy as markets speculate on the possibility of surprises from central banks with both the ECB and BOE meeting after Poland surprised,” said Tim Kelleher, the Auckland-based head of institutional foreign-exchange sales at ASB Institutional, a unit of Commonwealth Bank of Australia. (CBA) “If non-farm payrolls are strong you’ll probably continue to see dollar strength.”

The euro traded at $1.2978 at 10:03 a.m. in Tokyo from yesterday, when it touched $1.2965, the lowest since Dec. 11. The shared currency fetched 122.01 yen from 121.98 in New York. The dollar was at 94.02 yen after gaining 0.8 percent yesterday. It reached 94.77 on Feb. 25, the highest since May 2010.

The pound touched $1.4967, the lowest since July 2010, before trading at $1.4987, down 0.2 percent.

(Source: Bloomberg)