NEW YORK, (APP/AFP): The euro weakened against the dollar
Monday pressured by a return of negative inflation in the eurozone, while the safe-haven yen benefited from a disappointing G20 finance meeting.
The euro fell to $1.0876 around 2200 GMT from $1.0935 at the same time Friday.
Consumer prices tumbled in the 19-nation currency bloc in February, pushing inflation to a negative 0.2 percent, official data showed, and intensifying pressure on the European Central Bank to announce further stimulus.
“The latest CPI data from the region… suggests that deflation is only strengthening the region and that ECB will likely need to expand its monetary policy to combat the conditions on the ground,” said Boris Schlossberg of BK Asset Management.
The eurozone inflation rate’s negative turn was unexpected, but an 8.0 percent dive in energy prices was largely to blame.
“The indication of price pressures receding into deflation territory merely confirms what we’ve known for several weeks now: Markets are fully committed to the belief that the ECB will cut its deposit rate by 10 basis points at its next meeting” on March 10, said Christopher Vecchio, currency analyst at DailyFX.
A meeting of the finance chiefs of the Group of 20 big economies in
Shanghai ended Saturday with no major plan to address the slowdown in the
global economy.