Euro edges up versus dollar after ECB holds rates
TLT•The euro rose 0.13% to around $1.1167 after the ECB held rates steady and warned of rising inflation risks. The dollar eased after US inflation accelerated in September, while ECB President Christine Lagarde announced she will step down on February 7.
1. ECB holds rates steady
The European Central Bank kept interest rates unchanged, a widely expected move, and warned that inflation risks were rising due to surging energy costs. The euro was last up 0.13% at around $1.1167 after falling to its lowest against the dollar since May.
2. Lagarde to depart early
The ECB announced that President Christine Lagarde will step down on February 7, ahead of the end of her tenure in October 2027. European economist Marchel Alexandrovich said the ECB signaled that a December rate hike was firmly in play, citing upside risks to the inflation outlook.
3. Dollar and yen moves
US inflation accelerated in September as consumers paid more for gasoline and other goods, while the US economy grew faster than expected in the third quarter. Markets were pricing in a nearly 80% chance of a Federal Reserve rate hike in December. The dollar index fell 0.14% to 101.98, and the yen weakened 0.05% to 157.91 per dollar ahead of the Bank of Japan’s Friday decision, which was widely expected to leave rates unchanged.
