The euro was 0.5 percent from an almost three-month low versus the dollar before data forecast to show the region’s economy shrank and as Italy edged closer to a new election after last week’s inconclusive vote.
The 17-nation currency maintained yesterday’s drop against the pound as European Central Bank President Mario Draghi and his board prepare to meet on March 7. Australia’s currency was 0.8 percent from an almost eight-month low before the nation’s Reserve Bank meets today and on prospects policy makers will reiterate that they have scope to lower benchmark interest rates if needed.
“The Italian situation won’t be resolved soon so the euro malaise will continue,” said Marito Ueda, senior managing director in Tokyo at FX Prime Corp. (8711), a currency-margin company. “I think the ECB will consider rate cuts going forward. It’s unlikely there will be any euro buying catalysts from the ECB meeting this week.”
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