The buck came off its strong early highs after both the European Central Bank and the Bank of England stood pat on interest rates, in line with expectations. The ECB Governing Council decision was unanimous.

Jean-Claude Trichet, the ECB’s president, adopted a rather hawkish tone in his accompanying rhetoric, which is always scoured for its inner meaning, as he stressed that inflation risks remain.

“As we have said on previous occasions, inflation rates are expected to remain high for a rather protracted period of time, before gradually declining again,” Trichet said.

Unlike the Fed, the ECB has an explicit mandate to fight inflation, and it’s looking at unacceptable numbers. EU CPI in March was 3.3%, far above the ECB’s target of “close to” 2%.

The British pound got little support from the Bank of England’s stance, as it is widely considered temporary. “Given the lackluster economic data from U.K., most currency traders are anticipating more easing from the BOE as the year progresses,” said Boris Schlossberg, of Forex Capital Markets LLCR