Reply #76: FOREX-Euro hits 1-year high, extends Trichet-led rally [View All]

[Ghost Dog]

http://investing.reuters.co.uk/investing/financeArticle.aspx?type=allBreakingNews&storyID=2006-05-04T150621Z_01_NYJ000072_RTRIDST_0_MARKETS-FOREX-UPDATE-8-URGENT.XML
Thu May 4, 2006 4:06 PM BST

NEW YORK, May 4 (Reuters) - The euro rallied to its highest against the dollar in a year on Thursday, extending a rebound sparked by remarks from the European Central Bank chief that strongly suggested euro zone interest rates will rise next month.

The euro traded as high as $1.2694 <EUR=>, according to EBS, up 0.4 percent on the day and above the previous 1-year high of $1.2690 struck on Monday.

The euro had been hovering around $1.2600 before ECB chief Jean-Claude Trichet opened his news conference after the bank left benchmark rates on hold at 2.5 percent.

Trichet told reporters that policy remains accommodative and that the ECB must exercise strong vigilance in the face of rising price pressures.