The euro traded 0.3 percent from a seven-week high as economists forecast the European Central Bank will keep interest rates unchanged today even after President Mario Draghi stepped up rhetoric against the currency’s gains last month.
The euro is the past year’s best performer after the pound and Swiss franc, according to Bloomberg Correlation Weighted Indexes, which track 10 developed-nation currencies. The dollar held gains from yesterday as Federal Reserve Chair Janet Yellen said the U.S. economy is poised for growth. Australia’s dollar maintained losses before data predicted to show the unemployment rate rose.
“Markets in general just don’t believe that Draghi is willing to follow through at this point and they’re getting impatient,” said Emma Lawson, a Sydney-based senior currency strategist at National Australia Bank Ltd. “The currency market may be really wanting to call his bluff and if the ECB does nothing, which is what we expect, we may see a run up in euro-dollar close to $1.40.”