* ECB keeps rates unchanged, but signals action in December
* U.S. GDP rises at record pace in Q3
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Recasts, adds new comment, FX table, adds Lagarde's comments)
By Gertrude Chavez-Dreyfuss
NEW YORK, Oct 29 (Reuters) - The euro dropped to a four-week low against the U.S. dollar on Thursday,
after the European Central Bank president flagged further monetary easing in December.
At the same time, the dollar was bolstered in part by U.S. gross domestic product data, which showed
record growth for the third quarter, as well as an improving trend in jobless claims.
But the market's focus was on the ECB, analysts said, as Europe grapples with the surge in COVID-19
cases that forced national lockdowns in Germany and France and a regional lockdown Spain. The ECB, which kept interest rates steady, committed on Thursday to contain the growing fallout from a
second wave of coronavirus infections, saying it would hone its response by its December meeting.
"We agreed, all of us, that it was necessary to take action and therefore to recalibrate our
instruments at our next Governing Council meeting," ECB President Christine Lagarde told a news
conference. Erik Bregar, head of FX strategy at Exchange Bank of Canada in Toronto, said the euro's fall was "a
reflection of further monetary easing from the ECB."
In late morning trading, the euro fell 0.6% to $1.1681 EUR=EBS , after earlier falling to a four-week
low of $1.1675.
The euro also fell 0.4% versus the yen to 122.03 yen EUR=EBS .
Rapidly rising COVID-19 infection rates in Europe, along with caution ahead of the U.S. elections,
triggered the worst market sell-off since June earlier this week. The dollar index, with the euro as the largest component, rose to a four-week high and was last up
0.4% at 93.81 =USD .
The greenback slightly benefited from data showing record growth pace in U.S. GDP for the third
quarter.
Gross domestic product rebounded at a 33.1% annualized rate last quarter, according to an advance
estimate, the fastest pace since the government started keeping records in 1947. That followed a historic
shrinkage rate of 31.4% in the second quarter. A separate report showed 751,000 people filed for state unemployment benefits in the week ended Oct.
24, compared with 791,000 in the previous period.
"Although the data...appears healthy, it should be taken with a grain of salt," said Matthew Eidinger,
market strategist, at Cambridge Global Payments, as he cited rise in U.S. COVID-19 cases.
"The rapid rise in new infections threatens to reroute the economic recovery effort through a second
lockdown and potentially, a double dip recession," he added.
Against the yen, the dollar rose 0.25 to 104.46 yen JPY=EBS .
========================================================
Currency bid prices at 11:03 AM (1503 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR=EBS $1.1682 $1.1746 -0.54% +4.20% +1.1759 +1.1675
Dollar/Yen JPY=D3 104.4700 104.3250 +0.12% -3.84% +104.5000 +104.0300
Euro/Yen EURJPY= 122.03 122.52 -0.40% +0.07% +122.8700 +121.9000
Dollar/Swiss CHF=EBS 0.9150 0.9104 +0.49% -5.45% +0.9152 +0.9089
Sterling/Dollar GBP=D3 1.2924 1.2979 -0.41% -2.54% +1.3025 +1.2901
Dollar/Canadian CAD=D3 1.3338 1.3322 +0.13% +2.68% +1.3389 +1.3279
Aussie/Dollar AUD=D3 0.7039 0.7048 -0.11% +0.33% +0.7076 +0.7010
Euro/Swiss EURCHF= 1.0688 1.0692 -0.04% -1.53% +1.0702 +1.0679
Euro/Sterling EURGBP= 0.9036 0.9045 -0.10% +6.88% +0.9059 +0.9008
NZ NZD=D3 0.6630 0.6637 -0.09% -1.46% +0.6659 +0.6611
Dollar/Dollar
Dollar/Norway NOK=D3 9.5180 9.3640 +1.63% +8.49% +9.5855 +9.3345
Euro/Norway EURNOK= 11.1170 11.0070 +1.00% +13.01% +11.2075 +10.9495
Dollar/Sweden SEK= 8.9114 8.8264 +0.16% -4.66% +8.9263 +8.8260
Euro/Sweden EURSEK= 10.4108 10.3941 +0.16% -0.56% +10.4345 +10.3755