LONDON, April 12 Reuters The euro dropped to its lowest level since midNovember on Friday after the European Central Bank signalled it could cut rates as soon as June even with a hot U.S. economy likely forcing the Federal Reserve to wait until later in the year.

Meanwhile, the Japanese yen fell to a new 34year low as the dollar continued to charge higher, leaving investors vigilant for signs of intervention from Tokyo officials.

The euro dropped to 1.0674 in early European trading and was last down 0.47 just above that level. It was on track to have fallen 1.5 since Monday, its biggest weekly drop since mid2023.

A hot U.S. inflation print on Wednesday caused investors to rapidly rein in their bets on Fed rate cuts this year, moving the estimated start date from June to September.

But on Thursday the ECB signalled it was still likely to start cutting rates in the summer, given that inflation has fallen more sharply in the singlecurrency bloc.

The comments that weve had from ECB officials are that June is still on the cards and maybe more moves after that, said Jane Foley, head of FX strategy at lender Rabobank.

They seem to be acknowledging that there will be a divergence from the Fed and I think that was reassurance for speculators this morning hence the move in the euro.

The dollar index , which tracks the currency against six peers, was last up 0.38 at 105.67, a fivemonth high. It has jumped 1.3 this week, the biggest fiveday gain since May 2023.

The…