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Euro pulls off 2-month high; Draghi warns on excessive strength

The euro fell from a two-month high against the dollar on Thursday after the European Central Bank kept interest rates unchanged, as expected, but President Mario Draghi renewed a warning about the currency's strength.

The euro, which has gained over 4 percent in the past six months and helped ease inflation already running at subdued levels, was also buoyed by a rise in overnight money market rates driven by dwindling excess cash in the euro zone.


Yet in a news conference, Draghi said the strengthening euro was cause for "serious concern" on Thursday, and suggested the bank could take action next month after holding rates in May.

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The euro probed levels close to $1.40, its highest level since March 13 when it hit a 2-1/2 year peak of $1.3967 before falling to near $1.39 before the ECB rate decision.

--By Reuters, with CNBC.com

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