Euro sharply lower after SNB abandons cap, cuts rates
The euro fell to multi-year lows against the Swiss franc and the dollar on Thursday after the Swiss National Bank abandoned its exchange rate cap against the single currency and cut interest rates deeper into negative territory. The drop in the euro came after the Swiss National Bank surprised markets by scrapping the 1.20 per euro exchange rate floor it imposed in September 2011, in a bid to stave off deflation and prevent the continued appreciation of the safe-haven franc against the single currency.
The central bank also cut rates to minus 0.75%, from minus 0.25% before. EUR/CHF hit lows of 0.7710 following the announcement, before pulling back to 1.0277, a drop of 14.23% for the day.
EUR/USD hit lows of 1.1580, the weakest since November 2003 before trimming losses to trade at 1.1681, still down 0.89% for the day.
The euro fell to multi-year lows against the Swiss franc and the dollar on Thursday after the Swiss National Bank abandoned its exchange rate cap against the single currency and cut interest rates deeper into negative territory. The drop in the euro came after the Swiss National Bank surprised markets by scrapping the 1.20 per euro exchange rate floor it imposed in September 2011, in a bid to stave off deflation and prevent the continued appreciation of the safe-haven franc against the single currency.
The central bank also cut rates to minus 0.75%, from minus 0.25% before. EUR/CHF hit lows of 0.7710 following the announcement, before pulling back to 1.0277, a drop of 14.23% for the day.
EUR/USD hit lows of 1.1580, the weakest since November 2003 before trimming losses to trade at 1.1681, still down 0.89% for the day.
Pound slides lower vs. stronger dollar
The pound slid lower against the U.S. dollar on Thursday, as the greenback regained some strength after weakening in the previous session due to downbeat U.S. retail sales data.
GBP/USD hit 1.5201 during European morning trade, the session low; the pair
subsequently consolidated at 1.5187, shedding 0.31%.
Cable was likely to find support at 1.5074, the low of January 13 and resistance at 1.5337, the high of January 5.
The dollar regained some ground after falling broadly on Wednesday when a report showed the largest drop in U.S. retail sales in 11 months in December.
Official data showed that U.S. retail sales fell 0.9% last month after rising 0.4% in November.
Economists had expected a smaller decline to 0.7%. Consumer prices were unchanged from a month earlier, compared to expectations for an uptick of 0.1%. The slowdown in inflation underlined expectations that the Bank of England will keep interest rates on hold at record lows for most of this year. Sterling was higher against the euro, with EUR/GBP declining 0.43% to 0.7704.
The pound slid lower against the U.S. dollar on Thursday, as the greenback regained some strength after weakening in the previous session due to downbeat U.S. retail sales data.
GBP/USD hit 1.5201 during European morning trade, the session low; the pair
subsequently consolidated at 1.5187, shedding 0.31%.
Cable was likely to find support at 1.5074, the low of January 13 and resistance at 1.5337, the high of January 5.
The dollar regained some ground after falling broadly on Wednesday when a report showed the largest drop in U.S. retail sales in 11 months in December.
Official data showed that U.S. retail sales fell 0.9% last month after rising 0.4% in November.
Economists had expected a smaller decline to 0.7%. Consumer prices were unchanged from a month earlier, compared to expectations for an uptick of 0.1%. The slowdown in inflation underlined expectations that the Bank of England will keep interest rates on hold at record lows for most of this year. Sterling was higher against the euro, with EUR/GBP declining 0.43% to 0.7704.
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