Low inflation makes the euro safe haven

Low inflation makes the euro safe haven

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The euro constrains geopolitics

Tuesday, March 18, the euro continues to climb , and by 8:30 MSK currency reached the level of $ 1,393 after falling out of the debt crisis of confidence in the euro is gradually returning . Moreover, the players start another euro treat – it becomes for them a safe haven . Before the crisis of 2011 . foreign exchange market so concerned the yen. The reason for replacing the yen the euro was Japanese printing machine and a very low inflation rate in the area of circulation of the single European currency.

Consumer prices in the euro zone in February 2014. year on year, according to final data , rose by 0.7 % , reported on the eve of the European statistical agency Eurostat. Analysts had expected a growth rate of 0.8%.

In January 2014. Eurozone inflation at an annual rate was 0.8 %. Thus, the real rate of inflation is far behind the inflation target of the ECB, close to 2%. On a monthly basis, consumer prices in February 2014. increased by 0.3 % , which was also lower than expected 0.4%. In January 2014 and did . index decreased by 1.1%.

Euro currency is gradually becoming a conservative and increasingly gaining weight even on bad news . Foreign exchange market is gradually getting used to the euro zone as a refuge where the chief regulator – ECB – unlike counterparts in the U.S. , UK and Japan refers to an extremely conservative monetary policy . How long it will last is hard to say , and more likely it will depend on how long the European economy can survive with such a high rate of regional currency .

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