Dollar mixed on expected ECB rate slash
Greenback jumps against euro after European producer prices show steepest decline in 22 years.
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| Click the chart for current FX rates. |
NEW YORK (CNNMoney.com) -- The dollar rose against the euro Tuesday on negative European production data and ahead of a central bank meeting expected to slash rates to a record low.
A report showed European industrial producer prices dropped 3.1% in March from a year earlier, their steepest annual decline in in 22 years.
The data put more pressure on the European Central Bank to spark economic growth. The ECB will meet Thursday, and it's expected to cut its main interest rate to a record-low 1%.
"That the ECB will want to continue easing monetary conditions for some time to come is pretty much a foregone conclusion," wrote Carl Weinberg, chief economist at High Frequency Economics, in a research note.
The ECB could continue cutting rates or attempt unconventional policy actions such as buying securities to spark lending and economic growth.
Weinberg noted that the European Commission this week warned the euro zone's economy may shrink 4% this year and inflation will remain below target.
The dollar rose 0.56% against the euro to $1.3332.
The Bank of England will also hold a policy meeting Thursday, when it's expected to hold rates at a record-low 0.5%. The British pound was up 0.44% against the greenback to trade at $1.508.
The dollar was little changed against the Japanese yen. Both currencies are considered safe havens in uncertain economic times. The buck was up 0.15% against the yen at ¥98.85. 
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