The Euro rose on Wednesday against the dollar, reaching its highest level in eight days after a top official at Europe's Central Bank played down the possibility that the bank will lower interest rates.
Lower rates would give a boost to Eurozone nations but it they could also raise concerns about inflation. European Central Bank council member Axel Weber told Bloomberg Television that the outlook for Europe's economy was positive.
As long as that doesn't change, I would say that rates are still on the accommodative side and in no way restrictive, Weber said. There may be a certain wishful thinking priced into investors' interest- rate forecasts, he added.
Yesterday, addressing crisis management in amid ongoing financial turmoil in the markets, ECB President Jean-Claude Trichet affirmed that it was the duty of the central bank to anchor inflation expectations.
The euro rose to $1.4756 per euro at 4:52 p.m. from $1.4629 yesterday. It went as high as $1.4779, its highest since January 16. The Euro also rose against the yen, up to 158.12 euros per yen from 156.11 on Wednesday. The yen fell to 107.17 per dollar from 106.71 yesterday.