Euro Higher Today, but Could Fall Later

Euro is higher against its major counterparts right now, but it could fall later, thanks to a report indicating that the outlook for the eurozone is worse than expected, and that might prompt action from the European Central Bank.

Growth projections for the eurozone continue to fall, but that isn’t weighing on the 18-nation currency right now. Euro is mostly higher today. That could change, though. A report released today indicates that eurozone inflation for next year is expected to be at 1.0 per cent, which is lower than the earlier forecast for 1.2 per cent.
The report cites problems in Ukraine and the Middle East as problems. Additionally, ECB President Mario Draghi seemed to indicate that asset purchases could be in the future if the eurozone economy doesn’t pick up the pace. With this recent report, it looks as though the ECB may have to resort to those measures.
For now, though, the euro is enjoying a bit of a reprieve. However, if concerns continue to plague the 18-nation currency region, it might not be long before the euro starts losing ground again.
At 11:52 GMT EUR/USD is up to 1.2464 from the open at 1.2435. EUR/GBP is up to 0.7910 form the open at 0.7877. EUR/JPY is up to 144.1710 from the open at 143.7440.

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