Euro Remains Lower As ECB Chief Defends Stimulus Measures

The euro remained lower against its major counterparts in the European session on Wednesday, after the European Central Bank President Mario Draghi reaffirmed that the bank is committed to continue accommodative monetary policy for underlying inflation pressures to build up and support inflation in the medium term.

Although incoming data has become increasingly solid and downside risks vanish, it is too early to declare success, Draghi said at the Dutch Parliament. Underlying inflation pressures continue to remain subdued and have yet to show a convincing upward trend.

He said the ECB is monitoring various effects carefully, and taking into account price stability mandate. "The benefits of our policy clearly outweigh potential side effects," Draghi added.

Political uncertainty against the backdrop of President Donald Trump's abrupt dismissal of FBI Director James Comey also kept underlying sentiment subdued.

The euro held steady against its major counterparts in the Asian session, with the exception of the greenback.

The euro dropped to a 2-day low of 123.50 against the yen, from a high of 124.32 hit at 3:30 pm ET. The next possible support for the euro-yen pair is seen around the 122.00 zone.

Preliminary data from the Cabinet Office showed that Japan's leading index rose to a 21-month high in March.

The leading index, which measures the future economic activity, rose to 105.5 in March from 104.7 in February. This was the highest since June 2015.

The single currency stayed lower against the pound, after having fallen to near a 3-week low of 0.8383 at 2:15 am ET. The pair finished Tuesday's trading at 0.8406.

The National Institute of Economic and Social Research said that the Bank of England is likely to look through temporary spike in inflation and maintain its record low interest rate until mid-2019.

Consumer price inflation was projected to peak at 3.4 percent at the end of 2017 before gradually returning back towards the BoE's 2 percent target.

The euro eased back to 1.0938 against the Swiss franc, from an early high of 1.0969, and held steady thereafter. The pair was valued at 1.0955 when it closed Tuesday's trading.

The euro dropped to near a 2-week low of 1.0859 against the greenback in early European deals and remained lower in subsequent part of trading session. The euro-greenback pair traded at 1.0873 at Tuesday's close.

The single currency hovered around an early 9-day low of 1.4878 against the loonie, compared to 1.4916 hit late New York Tuesday. Further weakness may take the euro to a support around the 1.47 region.

The 19-nation currency slipped to a 6-day low of 1.4704 against aussie and a new 2-week low of 1.5627 against the kiwi, from its early highs of 1.4832 and 1.5805, respectively. The euro is likely to challenge support around 1.45 against the aussie and 1.54 against the kiwi.

Looking ahead, at 12:00 pm ET, Boston Fed President Eric Rosengren delivers a luncheon speech in South Burlington, Vermont.

The U.S. monthly budget statement for April is set for release at 2:00 pm ET.