The euro fell the most in two years versus the dollar after the European Central Bank unexpectedly cut its main refinancing rate to a record-low 0.25 percent to boost growth in the 17-member currency region.
The Czech koruna dropped the most on record versus the euro as its central bank approved the first currency sales in more than a decade. The dollar extended gains as a report showed the world’s biggest economy expanded at a faster pace than forecast before tomorrow’s jobs report. The euro pared losses after a report said the Bundesbank president and at least two other officials opposed the rate cut, according to two central-bank officials. The yen gained on haven demand as stocks dropped.
“News after the press conference suggests the Bundesbank wasn’t behind today’s rate cut,” Andrew Wilkinson, chief economic strategist at Miller Tabak & Co. in New York, said in a phone interview. “That shows the vote wasn’t unanimous and one more potential rate cut can be pretty much ruled out.”