Despite news that the European Central Bank (ECB) has raised the interest rate, the euro fell against the dollar as analysts forecast the end rather than the start of changes to the base rate.

This morning the dollar stood at 1.1705 against the euro, while the single currency was 1.4759 to the pound.

In line with expectations the ECB raised rates by a quarter percentage point, leaving the rate at 2.25 per cent.

Although this was the first change in two years, the noises accompanying the rate hike dampened speculation of sustained increases.

Luxembourg prime minister Jean-Claude Juncker was among those to sound a note of caution over rate rises, with the urge to control inflation offset by the need to facilitate growth in what is a relatively difficult climate.

"The bank should be aware of the danger of putting rates up," he said.

"We've got to look at price stability and growth prospects with a degree of caution."

Mr Juncker heads up eurozone finance ministers and says that it is important the ECB follows the continent's economic trajectory amid a "fragile" economy.