The euro remained near nine-month lows against the dollar on renewed expectations the European Central Bank may be considering cutting interest rates to boost economic growth in the 12-nation currency zone. The latest bout of speculation was sparked by comments last night from European Central Bank council member Jaime Caruana, who said risks to growth in the euro zone are "on the downside", and by a bigger than expected rate cut from Sweden's Riksbank. The risks to growth were highlighted further this morning by very disappointing French consumption data. Official figures showed French household consumption of manufactured goods fell 0.9 pct in May compared with a revised 1.1 pct rise in April and expectations of a more modest 0.2 pct decline. The later ZEW survey of German business confidence did little to alter sentiment towards the single currency and the pressure on the ECB. The ZEW said its German economic expectations index for June climbed 5.6 points to +19.5 from +13.9 in May and expectations of a rise to +7.3. "While political concerns seem to be losing their ability to damage the euro significantly, as demonstrated by relatively muted reaction to last week's EU summit results, the European currency remains acutely sensitive to indications the ECB might cut rates," said Daniel Katzive, an analyst at UBS. The dollar, which was in the doldrums for much of the last couple of years, due to concerns over the US twin deficits, has been buoyed this week by the political cloud hanging over the EU as well as a greater emphasis on developments related to yield differentials. "Focus is shifting from the European political backdrop to interest rate fundamentals, but the net effect is still the same; i.e. euro selling," said Mark Austin, global head of currency strategy at HSBC.