Peter Nurse

Investing.com – The dollar edged higher in early European trading Friday, rebounding a touch after falling to a one-month low against the euro in the wake of Thursday’s European Central Bank meeting.

The Dollar Index (which tracks the greenback in relation to a basket six currencies) traded 0.1% higher at $93.438 at 2:55 PM ET (755 GMT). This was just above the low of Thursday at 93.277, a level that has not been seen since September 27th.

After reaching the high of 0.7555 in July’s previous session, the price was just slightly lower at 113.53, but was generally flat at 1.3788. The closing rate was 0.7544.

It’s the pair which has seen most of the action of late, falling 0.1% to 1.1665 after rising as high as 1.1692 overnight for the first time since Sept. 28.

This follows Thursday’s ECB meeting, which resulted in the central bank leaving interest rates and asset purchases unchanged, as expected. Christine Lagarde was however the focal point. She suggested that the inflation rate would rise for longer. This prompted traders to wager on the central bank’s ability to reduce its accommodative monetary program faster.

“The ECB still sees the period of higher inflation as transitory but has become much more balanced with its inflation analysis, paving the way for further asset purchase reductions in December,” said analysts at ING, in a note.

Later in the day traders will be focusing on the economic data from both countries. Europe sees a preliminary reading, and the U.S. receives the final numbers.  

The and are expected to announce their next policy decision in the week ahead. This meeting will see the Fed begin asset tapering, and then the BOE announces an interest rate increase.