Yen falls but euro steady vs US dollar ahead of ECB meeting

[NEW YORK] The yen continued to fall Wednesday while the euro held steady against the US dollar ahead of the European Central Bank's policy meeting.

Adding to a nine-day slide, the yen fell another 0.7 per cent to 106.87 to the US dollar, and a similar 0.7 per cent against the euro, at 117.72 yen.

The Japanese currency has lost about six per cent on the US dollar since July 8, due both to relative weakness in the Japanese economy and a market move away from the safe haven currency as worries about Britain's vote to exit the European Union subside.

Ahead of the European Central Bank meeting Thursday, the euro-US dollar rate was fairly steady at US$1.1016, with no monetary policy change expected, but some speculation that the ECB chief Mario Draghi could hint at more stimulus action at its subsequent meeting.

"We think Mr Draghi's statement will send a strong signal that the ECB is willing to extend the duration of non-standard policy measures, if it perceives that it will take longer than expected to reach its target," said Claus Vistesen, eurozone economist at Pantheon Macroeconomics.

Meanwhile the pound jumped to US$1.3197 after Britain's unemployment rate fell to a 11 year low of 4.9 per cent in the three months to May.

AFP