The euro was boosted today by news that the European Central Bank (ECB) was lifting the benchmark interest rate by 25 basis points to 1.5 percent. The move was not unexpected as inflation was last recorded at 2.7 percent – well above the ECB’s target rate of 2 percent.
The Bank of England on the other hand, voted to maintain UK rates at the current record low rate of 0.5 percent. The growing interest rate gap between the two currencies could see investors favoring the euro over the pound.
Source: BBC News