Euro falls on ECB warning currency could get too strong

European Central Bank policy makers warned that further rises in the euro could impact on the region’s recovery, with the currency falling to its lowest level this month shortly after.

The ECB’s latest interest rate-setting meeting expressed concerns about the euro, which had hit a two-and-a-half year high against the dollar. The euro then dropped $1.1661 before picking up to $1.173 late yesterday, the Financial Times reports.

The eurozone’s recovery has been seen a driver of a recent strength in the euro, which has risen not just against the dollar but a number of other currencies,.

This also present a dilemma for the ECB when it decides to scale back its €2tn of quantitative easing.

Economist at the bank ING-DiBa Carsten Brzeski told the FT said the minutes indicated “an ECB which wants to steer . . . towards tapering extremely cautiously”.