Investing.com - The dollar remained mostly lower against the other major currencies in light trade on Wednesday, although the prospect of monetary easing limited the single currency''s gains, while the pound turned lower after the Bank of England’s quarterly inflation report.
EUR/USD was trading at 1.3707, up 0.04%.
The euro came under pressure following reports the European Central Bank is preparing to cut rates at its next meeting in June.
Reuters reported that the ECB is preparing a “package of measures” including cuts to all interest rates, with negative rates on bank deposits and measures to bolster lending to small and medium size businesses.
The report came one day after the Wall Street Journal reported the Germany’s Bundesbank would back monetary easing measures by the ECB if they were needed to keep low levels of inflation from becoming entrenched in the region.
GBP/USD was down 0.32% to 1.6773, after the Bank of England left its forecasts for growth and inflation largely unchanged and played down speculation over the timing of a possible rate hike.
The BoE said in its quarterly inflation report that it now expects economic growth of 2.9% in 2015, up from 2.7% in its February report, and said the rate of growth this year would remain unchanged at 3.4%.
The bank said it expects annual inflation to be close to its 2% target over the next two to three years if interest rates in the U.K. rise in line with expectations in financial markets.
In addition, official data showed that the U.K. unemployment rate ticked down to a more than five-year low of 6.8% in the three months to March from 6.9% in the three months to February, in line with expectations.
The claimant count fell by 25,100 last month, the ONS said, compared to expectations for a decline of 30,000 people. March’s figure was revised to a drop of 30,600 people from a previously reported decline of 30,400.
The report said that average weekly earnings rose by 1.7% on a year-over-year basis in the three months to March, but excluding bonuses average earnings only rose by 1.3% during the quarter, and just 1.0% in March.
Elsewhere, the dollar declined lower against the yen, with USD/JPY sliding 0.45% to 101.81, while USD/CHF dipped 0.03% to 0.8899.
The Australian dollar remained near one-month highs, with AUD/USD rising 0.29% to 0.9385, while NZD/USD was up 0.41% to 0.8663 and USD/CAD eased 0.02% to 1.0903.
The New Zealand dollar shrugged off data on Wednesday showing that domestic retail sales rose 0.7% in the first three months of the year, falling short of expectations of 0.9%.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.05% at 80.15.