March 10, 2016 / 1:02 PM / 2 years ago

FOREX-Euro dives as ECB pulls out stops in growth push

* ECB cuts rates, announces corporate bond buys

* Measures top what market had priced in for meeting

* Eyes on Draghi news conference for more detail

* Euro down more than 1 percent on day at $1.0874

By Patrick Graham

LONDON, March 10 (Reuters) - The euro sank a full cent against the dollar on Thursday after the European Central Bank unveiled a raft of measures, many of them not expected by markets, to stimulate growth and inflation in the euro zone.

The ECB cut its marginal and refinancing rates as well as making a widely expected 10 basis point cut in deposit rates. It also expanded its programme of bond-buying to include corporate debt.

The euro, already down against the dollar on the day, sank to a one-week low of $1.0863 per dollar from around $1.0970 before the announcement. It also fell by more than half a percent against the Swiss franc, yen and sterling.

Expectations had been high that ECB policymakers would deliver a telling blow in the central bank’s campaign to get inflation rising again and drag the euro zone economy out of the mire after eight years of weak growth.

But senior currency sales managers at a handful of major banks had said that speculators were probably only about a third as much engaged against the euro as they were before a December decision that underwhelmed and left many of their investments underwater.

“This was a much bigger bazooka than the market was expecting and shows the ECB trying to get ahead of the confidence curve after learning its lesson in December,” said John Hardy, head of currency strategy at Saxo Bank.

“The euro is under pressure.” (Editing by Nigel Stephenson)

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