Eurozone again experienced deflation for the first time in the last five years, putting pressure on the European Central Bank to immediately launch a program of monetary stimulus, known as quantitative easing.
Eurostat reported the consumer price index year-on-year euro zone in December of 0.2%. Until December, inflation has been below the ECB’s target of 2.0% in 22 months, inflation began to decline in August 2012, breaks down 1.0% in October 2013, following 0.5% in July 2014, to re-experience deflation for the first time since October 2009.
The ECB has signaled that it will respond to a decrease in the consumer price index with additional monetary stimulus, including the purchase of government bonds. However, the decline in inflation is said to occur due to a sharp decline in the price of fuel. Some policymakers believe the ECB will not rush poured additional monetary stimulus for the decline in inflation due to a decrease in energy prices. As time went on the decline in energy prices can be said to encourage consumer spending that would raise the price of goods and services.
EURUSD traded at around 1.1842 at 18:20 pm with daily highs and lows 1.1895 1.1839 (Monex Trader platform). (pap)