The European Central Bank (ECB) kept rates on hold at 2.5 per cent today as expected to leave markets waiting guidance on an expected rate rise next month and the pace of hikes for the rest of the year.
The euro softened a little after the announcement to trade at 1.259 against the US dollar, broadly within its range for the day. German Bund and Euribor futures ticked briefly higher.
The market is awaiting ECB president Jean Claude Trichet's news conference. He will probably indicate the ECB is preparing an increase in June to tackle inflation from rising oil prices and money supply, and shrinking spare capacity in the economy.