Article by ForexTime
Comments from European Central Bank President on Friday from the Jackson Hole Symposium signaled some “dovishness” and that the ECB may take action soon, especially in order to deal with soft inflation in the Eurozone.
Draghi used stronger language than he has used in the past and said that the ECB is prepared to respond with all its “available” tools should inflation drop further.
Inflation is a big issue for the ECB and it is being closely watched. Draghi noted a decline in short, medium and longer term inflation expectations and indicated this would be acknowledged at the next ECB policy meeting.
Focus will be on inflation data this Friday from the Eurozone. Forecasts are that inflation slowed to 0.3 percent in August from 0.4 percent in July. That is well below the ECB’s danger zone of 1.0 percent and its target of just under 2.0 percent.
The euro has weakened considerably since Draghi’s comments and is trading at a near one year low of $1.3185.
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Article by ForexTime
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