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Euro-dollar rate flat amid equities sell-off

The euro-dollar rate was little changed while the yen gained amid a broad sell-off in European and US equities on Thursday that was driven in part by eurozone growth worries.

NEW YORK: The euro-dollar rate was little changed while the yen gained amid a broad sell-off in European and US equities on Thursday that was driven in part by eurozone growth worries.

The main movement of the day in financial markets was from stocks and other risk assets to quality bonds. That pushed down yields on US Treasuries; the 10-year bond hit 2.48 per cent during the day, a low last seen in October.

Eurostat reported that gross domestic product across the 18-nation eurozone grew by just 0.2 per cent in the three months to March, dashing market expectations for 0.4 per cent expansion.

However, the German economy sprinted ahead at an 0.8 per cent pace.

"GDP figures largely disappointed, with only the German release providing any upside to the data," said Alpari trader Craig Erlam.

"That's pretty much in line with what we've become accustomed to: a two-tier eurozone with Germany the engine behind any growth."

The data gave strength to expectations that the European Central Bank will ease monetary conditions to fight off disinflation in its next policy meeting. Analysts expect that will ultimately help boost the US dollar, benefitting from stronger growth in the US economy.

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