* Euro sold off after ECB policy move
* Euro hits nearly 2-year low against Swiss franc
* U.S. dollar gains despite weak jobs data
(Adds comments, updates prices, changes byline, dateline,
By Sam Forgione
NEW YORK, Sept 4 The euro hit fresh 14-month
lows against the U.S. dollar and nearly two-year lows against
the Swiss franc on Thursday after the European Central Bank cut
interest rates and said it would launch an asset purchase
program to ward off deflation.
ECB President Mario Draghi, speaking at a news conference
shortly after the ECB unexpectedly cut already ultra-low
interest rates by another 10 basis points, said the central bank
would start purchasing securitized loans and covered bonds next
The euro sank to $1.2997 against the U.S. dollar, marking
the first time the shared currency broke below $1.3000, a key
technical resistance point, in 14 months. Against the Swiss
franc, the euro fell to 1.20450 on the EBS platform, its lowest
since November 2012.
"It was a surprise to the market," said Chris Gaffney,
senior market strategist at EverBank Wealth Management in St.
Louis. "It increases the possibilities for further quantitative
easing out of the ECB."
There had been increasing speculation that the ECB could
embark on an asset purchase program, or quantitative easing,
after Draghi hinted at such a policy shift at a central bank
symposium in Jackson Hole, Wyoming on Aug. 22.
The U.S. dollar rose broadly against major currencies,
despite weaker-than-expected U.S. jobs data.
The ADP National Employment Report of private-sector
employment showed U.S. companies hired 204,000 workers in
August, below economists' expectations for an increase of
220,000, according to a Reuters poll.
The Labor Department, meanwhile, said initial claims for
state unemployment benefits increased 4,000 to a seasonally
adjusted 302,000 for the week ended Aug. 30, slightly above
expectations but remaining at levels consistent with tightening
labor market conditions.
Analysts said Friday's U.S. nonfarm payrolls figure, if
strong, could push forward expectations for the first Federal
Reserve interest rate hike to the first quarter of 2015.
Economists expect U.S. employers to have added a strong 225,000
jobs in August, according to a Reuters poll of economists.
"If we do get a stronger-than-expected number, it will
embolden the market's expectation that the Fed will become more
optimistic, and, with that, more hawkish," said Brian
Daingerfield, currency strategist at the Royal Bank of Scotland
in Stamford, Connecticut.
The euro was last down 1.06 percent against the
dollar at $1.3011. The dollar was up 0.22 percent against the
Japanese yen at 105.02 yen, and was up 1.02 percent
against the Swiss franc at 0.9268 franc.
The U.S. dollar index, which measures the greenback
against a basket of six major currencies, was last up 0.65
percent at 83.405.
Benchmark 10-year U.S. Treasury notes were last
down 7/32 in price to yield 2.44 percent, from a yield of 2.41
percent late on Wednesday.
(Editing by Jonathan Oatis)