Strong German employment data was not enough to counterbalance the impact of yesterday morning’s Eurozone inflation figures, which showed that the bloc had, as a whole, slipped into deflation. The result was that we saw the euro fall to fresh nine-year lows against the US dollar, with the inflation figures giving weight to the argument for increased stimulus measures. European Central Bank (ECB) President Mario Draghi looks to have been backed into a corner, with no choice but to ramp up asset purchases. Some analysts are betting that we will see a decision made as early as this month, and any such decision will likely undermine the euro further.
Looking to today, the only fundamental release to keep an eye on will be European retail sales released this morning.