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Euro barely changed against US dollar

BERLIN - The euro was barely changed against the US dollar on Wednesday, largely holding gains it made as the chances of higher US interest rates appeared to wane.

The 12-nation euro bought US$1.2825 in afternoon European trading, compared with US$1.2831 in New York late Tuesday. The euro has rebounded by about one US cent since the end of last week.

The British pound rose to US$1.9022 from US$1.8989, while the dollar was at 117.06 Japanese yen, up from 116.61 yen.

The euro advanced Tuesday after the minutes of the US Federal Reserve’s most recent policy meeting disappointed investors who had expected a more hawkish stance.

The minutes of the Aug. 8 meeting - at which the Fed kept interest rates unchanged for the first time in more than two years - indicated that central bank policy-makers generally expect core inflation to decline gradually, suggesting less need for higher rates to curb price rises.

Higher rates boost a currency by making some classes of security more attractive to international investors.

The European Central Bank is widely expected to raise its rates again before the end of this year, but not at its meeting on Thursday.

Washington on Wednesday reported another sign of slowing growth, with the economy growing at a 2.9 percent annual rate in the spring _ better than first estimated but nowhere near the brisk pace logged in the winter.

The US Commerce Department reported that gross domestic product in the April-to-June quarter increased slightly more than the 2.5 percent pace first reported a month ago.