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Euro is heading for its worst weekly loss in 19 months on Friday after a cautious European Central Bank indicated its intention to keep interest rates at record lows well into next year.

Following a closely-watched meeting on Thursday, the ECB said it would end its massive bond purchase scheme by the end of this year, taking its biggest step towards dismantling crisis-era stimulus.

With that, the euro shortly rose to a one-month high of $1.1853 following the announcement.

Euro Retreats after Interest Rate

Euro bulls immediately retreated as soon as ECB also signaled that it would keep interest rates steady at least through the summer of 2019, reflecting the uncertainties hanging over the eurozone economy.

The single currency slumped nearly 1.9 percent on Thursday, its largest one-day fall since Britain's June 2016 Brexit vote shock.

It stretched overnight losses to brush $1.1555, lowest since May 30. The currency was down 1.72 percent on the week, positioning it to have its biggest weekly loss since November 2016.

Euro bulls had been emboldened earlier this month as expectations grew for the ECB to begin raising rates at an earlier juncture in 2019, after comments by policymakers such as ECB chief economist Peter Praet, who struck a hawkish tone despite recent political troubles in Italy.

Dollar, Feds, Other Currencies

The euro was a shade higher at 128.035 yen after dropping 1.7 percent overnight.

The dollar edged up 0.1 percent to 110.720 yen after rising 0.25 percent the previous day.

The dollar index gained about 0.2 percent to a two-week high of 94.995, after rallying more than 1 percent on Thursday.

The greenback was up roughly 1 percent versus its Japanese peer on the week, during which it brushed a three-week peak of 110.850 after the Fed's Wednesday policy announcement.

The Fed on Wednesday raised interest rates for the second time this year and indicated that it could tighten policy two more times in 2018.

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