Tuesday, September 30, 2014

Euro falls: Low inflation currency crashes – ABC Online

Euro falls: Low inflation currency crashes – ABC Online

Tuesday, 09.30.2014, 11:46
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Cheaper energy has pushed the euro zone in September to its lowest level in nearly five years, the rate of inflation. Including the euro suffers. He falls to the lowest level in two years

The chances of purchases of government bonds in the billions by the European Central Bank (ECB) grow. In September, consumer prices only increased by 0.3 percent over the same month last year, as the statistics office Eurostat said on Tuesday. A lower value was last seen at the height of the global financial crisis in October 2009, when the prices even decreased slightly. In July and August, the inflation rate had stood at 0.4 percentage

The danger of deflation is always tangible -. Scenario that ECB chief Mario Draghi wants to prevent at all costs. To prevent harmful for the economy falling prices across the board, the ECB had already lowered its key interest rate in September to a record low. They also pumped billions of cheap money into the economy

decline in inflation

The renewed decline in inflation therefore put the euro at:., He expands his losses and is 1.26 dollars as cheap as last beginning September 2012

<- finance-chart.tag!: {"M_LINK":"http://m.finanzen100.de/waehrungen/euro-us-dollar-eur-usd_H1763038774_14959435/","PERF_PCT":"-0,87%","PRICE":"1,2595","NAME":"Euro / U.S. Dollar (EUR/USD)","PERF_PCT_RAW":-0.8658,"WWW_LINK":"http://www.finanzen100.de/waehrungen/euro-us-dollar-eur-usd_H1763038774_14959435/","CURRENCY":"EUR","PERF_ABS_RAW":-0.011,"PRICE_RAW":1.2595,"CHART_URL":"http://c.finanzen100.de/bwcharts/images/finanzen100/intraday/fol_small.png?ID_INSTRUMENT=14959435&key.codeMarket=DE%21%40DE%21W%24%24%21%40W%24%24","PERF_ABS":"-0,0110"} ->

Euro / U.S. Dollar (EUR / USD )
1.2595 EUR
- 0.0110 (- 0.87%)

At the same time attracted to the European stock exchanges at prices because investors now expect a further easing of the ECB. The Dax was up. Even more cheap money would probably flow first to the capital markets and trigger new course fireworks there.

On Thursday, the monetary authorities decide again at its next meeting on monetary policy. Details are expected to planned purchases of mortgage bonds and credit instruments bundled. "I do not think the pressure to act on the ECB by the further decline in inflation is rising," but said Nordea economist Holger Sandte. The low point in prices could be achieved now.



The dollar is gaining strength

The reason for the weak euro is not only the loose monetary policy of the ECB. Add to this that the American Federal Reserve slowly begins to tighten monetary policy again. She drives back the monthly bond purchases because recovers the U.S. economy. This is good for the dollar, it becomes more valuable.

"There is brewing for the euro-dollar exchange rate of the perfect storm together," Commerzbank therefore wrote in a recent study. "The question is really: how far the exchange rate will fall And: How quickly is the Devaluation" Commerzbank expects an exchange rate of $ 1.20 by the end of 2015

video comment. Whoever is to blame for the weak euro

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