Euro, pound in trough in Asia ahead of rate decisions

TOKYO, September 4, 2008 (AFP) – The euro and pound languished in Asian trade Thursday but were off lows against the dollar ahead of central bank decisions in Europe, where economies are looking increasingly shaky, dealers said.

The euro edged up to 1.4506 dollars in Tokyo morning trade after slipping to a seven-month low of 1.4492 in New York late Wednesday. It rose to 157.04 yen from 156.92. The dollar was flat at 108.27 yen.

Sterling fell to 1.7745 dollars from 1.7767, after falling to 1.7706 Wednesday in New York trade, its lowest point since April 2006.

The European Central Bank and Bank of England both meet later Thursday. Both are expected to keep interest rates steady despite growth worries as inflation is also a persistent concern, dealers said.

The forex market moved in part due to “position squaring ahead of BoE and ECB official interest rate decisions (Thursday) and US non-farm payrolls Friday,” said National Australia Bank currency strategist John Kyriakopoulos.

While dealers do not expect rate changes, they will look carefully for how the central banks describe the balance of concerns over inflation and growth for clues on the outlook of rates.

“The broad trend for the euro and the pou