WASHINGTON: The euro sank against the dollar Thursday after European Central Bank chief Mario Draghi hinted at more possible easing, following the announcement of an expected quarter-point interest rate cut.
The euro dropped one US cent as Draghi told a news conference that "our monetary policy stance will remain accommodative for as long as needed. We will look at all incoming data and stand ready to act if needed."
Prior to that the euro had been stable as the ECB cut its benchmark refi rate to a record low 0.50 percent, seeking to reverse the ongoing recession in the eurozone.
But the suggestion that the ECB could go farther -- possibly taking rates into negative territory -- pulled the rug out from under the currency, analysts said.
At 2100 GMT the euro was at $1.3063 compared to $1.3180 late Wednesday.
The dollar also gained on Japan's currency, to 97.93 yen from 97.40 yen, while the euro slipped to 127.93 yen from 128.37
"What really got the euro dropping though was that Mario mentioned that the ECB could possibly consider a negative deposit rate in the future that would essentially charge a fee to banks who decide to keep capital at the ECB," said Neil Gilbert of GFT Markets.
"That mention opened the door for future rate cuts," he said.
After a six-day roll, the British pound slipped back against the greenback, trading at $1.5531 from $1.5556. The dollar also rose to 0.9345 Swiss francs from 0.9271 francs.
<Center><b><i>Copyright AFP (Agence France-Presse), 2013</b></i></center>
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