Early trade in New York: Euro jumps as ECB disappoints

NEW YORK: The euro jumped on Thursday after the European Central Bank disappointed some investors looking for a larger stimulus boost, while sterling fell after post-Brexit trade talks were extended to the weekend in hope of an elusive breakthrough.

The ECB expanded its debt purchase scheme and agreed to provide banks with even more ultra-cheap liquidity as long as they keep passing the cash onto companies. But it "left the gun powder dry and no bazooka was fired. This has made investors bullish on the euro as the expectations were that the ECB is worried about the economic recovery," said Naeem Aslam, chief market analyst at Ava Trade.

The euro was last up 0.60% on the day at $1.2154. Sterling was last down 0.65% at $1.3315. The British currency is struggling to get above technical resistance at the $1.35 area, and this is the third time it has failed at this level since December 2019, said Tom Fitzpatrick, global head of CitiFX Technicals. The Aussie gained 1.03% to $0.7518.