The euro fell against the dollar yesterday, as an expected promise of regular interest rate hikes failed to materialise.
Standing at 1.4621 to the pound, the euro was at 1.1709 against the dollar this morning.
Jean-Claude Trichet, the president of the European Central Bank, told a European Parliament committee that plans for an interest rate increase in December, might not be the first of many.
"I don't see at all, ex ante, the start of a series of augmentation of interest rates," he said.
It had been predicted that rates would rise by a quarter percentage point from two per cent for each quarter next year.
Michael Jansen, currency strategist at National Australia Bank in New York, told Reuters that the announcement had come as a surprise to a number of experts who had seen the promise of higher rates as a lure for investors.
"It adds to the confusion on what the ECB's real agenda is," he said.