London, Oct. 10 (Bloomberg) -- The euro rose against the dollar to the highest level since Sept. 6 amid speculation the European Central Bank will signal at its meeting today it may cut interest rates in coming months. The euro gained for a second day to 99.11 U.S. cents at 10:30 a.m. in London, from 98.81 late yesterday. Europe's common currency strengthened to 122.39 per yen, from 121.88.
The ECB will probably keep the key rate for the 12-country region at 3.25 percent for an 11th month, all but two of 15 economists surveyed by Bloomberg News said. The ECB's decision is due at 12:45 p.m. London time.
Europe's common currency gained because of talk ``they're switching to an easing bias,'' which would signal a rate cut, said Adam Myers, a currency strategist at Westpac Banking Corp.
While ECB council member Ernst Welteke suggested in comments this week that interest rates are appropriate, ``that means it's appropriate until the next meeting,'' Myers said. ``That's how the ECB operates.'' The rate on the December interest-rate futures contract dropped 1 basis point to 2.96 percent. That compares with a three- month lending rate of 3.23 percent.
More than half the economists surveyed predict the ECB will cut borrowing costs by at least a quarter of a percentage point by the end of the year. //www.quote.bloomberg.com