» Forex - Dollar fell after BoE and ECB left rates unchanged

The Euro rebounded on Thursday from a two-month low against the Dollar after European Central Bank President Jean-Claude Trichet said inflation remains his top concern, signaling the bank won’t cut interest rates anytime soon. After the ECB left the benchmark refinancing rate at 4% on Thursday, Trichet told reporters that high energy and food costs mean the euro-zone still faces “a protracted period” of high inflation.

The ECB’s continued focus on inflation at a time when global growth appears to be slowing prompted investors to reduce exposure to risk, and that boosted the low-yielding Yen that’s typically used to finance risky trades.

The Bank of England left interest rates on hold at 5%. Economic data in Britain has reflected a weakening economy, with house prices sliding rapidly, and analysts said they expected the BoE to cut rates when it meets again in June.

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