06 May 2009

Traders' Fears Mount Ahead of ECB Meeting

The ECB is set for their latest meeting on Thursday, and tension is mounting. It is known that they will cut interest rates again, to 1 per cent down from 1.25 per cent, but it is the other measures that they will discuss that are causing worries amongst traders on the foreign exchange market.

There are fears that the ECB's tactics may not be enough to boost the Eurozone economy, and that there is too little, too late in the approach of the Bank. The British Pound hit a four-month high against the US dollar yesterday before retreating again. It also gained against the Euro. This kind of trend is being seen as evidence of traders' increased concerns.

Jean-Claude Trichet, the ECB boss, has mentioned "non-conventional" methods and policies to be discussed for adoption. It comes later than UK and US central banks who have already introduced drastic measures to boost economies.

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