Euro at one-week low against dollar; Awaits ECB interest rate decision

Euro is holding gains but stays in close proximity to a one week low against the dollar on Thursday as investors await European Central Bank (ECB) decision due later today. There is extremely high probability that the central bank is going ahead with a rate cut as the Eurozone grapples with economic weakness, political uncertainty in Germany and France and as Eurozone price pressures seem under control. So far, the ECB has already cut rates at three of its last four meetings. In late November, EURUSD counter plunged to its lowest level since October last year and lingers around the level. Currently, the pair is quoting at $1.0512, up 0.18% on the day. The small uptick seen is on the back of mild weakness in the US dollar index after an almost flat US inflation reiterated possibility of Federal rate cut in its upcoming meeting. The US Dollar Index (DXY), which tracks the greenback value against six major currencies, fell to near 106.25, lower by 0.14% on the day. US Producer Price Index (PPI) data for November and the Initial Jobless Claims data will likely provide additional directional cues for the counter going forward.

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