Overseas property buyers may be boosted today by a cut in the euro interest rate.

Investors on the foreign exchanges priced in a cut by the European Central Bank (ECB) yesterday, causing the euro to fall in value against the dollar, the International Herald Tribune reports.

The expectation is for the ECB to reduce the rate from two per cent to 1.5 per cent, something that could make euro mortgage rates lower for overseas property buyers.

A cut may also impact on the exchange rate between the euro and sterling, with any favourable movement meaning that those starting off with pounds could enjoy more purchasing power.

The governing council of the ECB voted to hold the rate last month, following a series of cuts in previous meetings.

January saw a 0.5 per cent reduction to the main refinancing rate, which was previously trimmed by 0.75 per cent in December and 0.5 per cent in November.

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