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Euro slips to day's low vs dollar after ECB leaves rates unchanged
October 6, 2011 / 12:00 PM / in 6 years

Euro slips to day's low vs dollar after ECB leaves rates unchanged

LONDON, Oct 6 (Reuters) - The euro initially hit a session low against the dollar while bund futures rose on Thursday after the European Central Bank left key interest rates unchanged, prompting some investors to trim bets on the possibility of a risk rally if the central bank had announced monetary easing measures.

European share prices trimmed gains after the decision.

The ECB held interest rates at 1.5 percent on Thursday as a jump in inflation last month offset pressure to respond to the euro zone’s worsening debt crisis by easing borrowing costs.

The euro fell to a session low of $1.3265, before bouncing back up to $1.3300, little changed from before the ECB announcement.

German Bund futures FGBLc1 briefly extended losses after the announcement before rallying to session highs of 137.33, 27 ticks higher on the day with one trader saying with some in the market expecting a cut, the unchanged stance was negative for risk appetite.

The FTSEurofirst 300 index of top European shares trimmed gains after the decision, up 1.2 percent at 927.28 points. The benchmark index was up 1.9 percent briefly before the decision.

Reporting by London Market Team

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