As the European Central Bank prepares to meet later today, the common currency Euro slipped versus the greenback during the Asian trading session though underlying support should keep the EUR/USD pair within a relatively tight trading band.
As reported at 1:07 p.m. (JST) in Tokyo, the Euro-Dollar was trading at $1.2537, a loss of 0.2% from Tuesday’s peak of $1.2629, and holding close to last Friday’s $1.26378 peak on the EBS trading platform, the highest level in nearly two months. The Euro also dipped lower against the sae haven Yen, declining 0.2% to trade at 98.33 Japanese Yen.
It was recently learned that on Monday, Mario Draghi, the head of the ECB, had told Eurozone policymakers that the central bank’s purchases of sovereign debt from troubled E.U. members was not considered a breach of E.U. rules, a long-held concern raised by many critics of the bank. Those comments bolster speculation that the ECB will move to further aid ailing states such as Italy and Spain and are providing the common currency with a fair amount of support, though some investors worry that the Euro’s gains are a result of a “buy the rumor” type rally in advance of today’s ECB meeting.