Loss in momentum deters EUR's fresh lows for now
Used with permission from Bloomberg Finance LP, as of 11 March 2018.
The market naturally expressed concerns over the ECB’s lack of confidence in the Eurozone’s economic prospects, and the central bank’s ability to normalise policy in the near term – the ECB still sees the harmonised index of consumer prices (HICP) headline inflation at around 1.6% in 2021. The question of whether the ECB is in the position to ward off any recession threat – compared to the Federal Reserve providing the flexibility to ease in the future by pre-emptively hiking rates – also stood out.
The EUR reacted, printing a fresh 21-month low of 1.1177.
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