May 5th 2006
ECB drives Euro to one-year high
The European Central Bank deserves full credit for the Euro’s breakthrough to a one-year high against the USD, yet it didn’t lift a finger. Rather, the ECB all but assured investors it would raise interest rates by 25 basis points to 2.75% in June. Jean-Claude Trichet, President of the ECB, joked with investors that they have been able to predict European monetary policy with reasonable accuracy. Trichet also commented the EU’s economic recovery, which is driving inflation and necessitating the interest rate hike. Reuters reports:
The [Euro] has climbed over 3 percent against the dollar in the past month to its highest level in almost a year and to a similar comparative level on a trade-weighted basis.
Read More: ECB steps up inflation warnings, signals June
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