By Ron Harui
Oct. 28 (Bloomberg) -- The euro dropped to its lowest in more than two years against the dollar on speculation European interest rates will slide as recession looms.
The currency approached a six-year low versus the yen after European Central Bank President Jean-Claude Trichet said yesterday he may cut interest rates next week, less than a month after slashing the key rate by half a point. Europe's economy is on the brink of a recession, with the region's manufacturing and service industries contracting at a record pace in October and German business confidence dropping to a five-year low.
``There are a bit more concerns over the European economic slowdown and there may be a rate cut,'' said Lee Wai Tuck, a currency strategist at Forecast Pte Ltd. in Singapore. ``People are selling the euro.''
The euro weakened to $1.2367 at 10:28 a.m. in Tokyo from $1.2493 late yesterday in New York. It earlier touched $1.2330, the weakest since April 2006. The 15-nation currency was at 114.81 per euro from 115.92 yesterday, when it touched 113.64, the strongest level in more than six years. The dollar traded at 92.89 yen from 92.78.
To contact the reporters on this story: Ron Harui in Singapore at rharui@bloomberg.net
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