* Euro falls sharply after ECB's Draghi's comments on
* ECB cuts benchmark rates as expected, says policy to
* U.S. economic data lifts dollar versus yen
By Wanfeng Zhou
NEW YORK, May 2 The euro fell sharply against
the dollar in choppy trading on Thursday after European Central
Bank President Mario Draghi said the bank is technically ready
for negative deposit rates and noted downside risks to the
Draghi's comments came after the ECB cut its benchmark
refinancing rate by 25 basis points to a record low 0.5 percent,
its first cut in 10 months and left the deposit rate unchanged.
"Although Draghi reiterated that the ECB was technically
prepared for a cut in the deposit rate (now zero), in the past
he had warned about the potential negative consequences. Now he
is saying (he) has an open mind," said Marc Chandler, global
head of currency strategy at Brown Brothers Harriman in New
The euro fell 0.8 percent to $1.3066, having
hit a session low of $1.3061, according to Reuters data.
It had risen to a session peak of $1.3215 earlier after
Draghi said the central bank's monetary policy will remain
accommodative for as long as needed, which boosted hopes further
stimulus will help the euro zone's economy to recover.
Highlighting the fragility of economy, surveys on Thursday
revealed a deepening contraction in manufacturing in April.
Against the yen, the euro fell 0.4 percent to 127.86 yen
"Essentially, the euro was sold on Draghi's comments that
they really opened the door to further easing," said Michael
Woolfolk, senior currency strategist at BNY Mellon in New York.
The dollar rose 0.4 percent to 97.76 yen, having
earlier risen 1 percent after data showed the number of
Americans filing new claims for jobless benefits fell sharply
last week to a five-year low while the U.S. trade gap narrowed