0748 GMT [Dow Jones] Of all the reasons listed for why the ECB should provide more stimulus, the surge in the EUR is one of the most compelling. A stronger currency could exacerbate the present disinflationary trend in the euro zone and also risk the economic recovery by making exports from the region less competitive. Frederic Pretet of Scotiabank thinks the situation is not as clear cut and the ECB's threshold for currency appreciation may be higher than expected. That's because the EUR's strength has been underpinned by greater capital flows into the euro zone periphery. And as the EUR has rallied and investors stepped in, riskier euro-zone bonds are outperforming safer German debt. Further stimulus may not temper these capital inflows. (neelabh.chaturvedi@wsj.com)
Contact us in London. +44-20-7842-9464
Markettalk.eu@dowjones.com
(END) Dow Jones Newswires
May 08, 2014 03:48 ET (07:48 GMT)
0 Response to "ECB's Euro Threshold Maybe Higher Than Assumed"
Thanks for give comment.