Euro in Forex Trading

235526 Resource 128460 120646 120646 1246367130507 1246368833178 Controlled Euro Zone Inflation Drops Below 0%

What does this mean for euro zone economic stimulus efforts?

For the first time since 1991, the euro zone has seen a drop to inflation. Inflation has fallen to below 0%, introducing a definite trend toward deflation (although the economy is not in a state of deflation right now). The euro zone has been criticized in recent months for its lack of economic stimulus measures, and some see this information as proof that more should have been done. However, euro zone leaders maintain that they are doing what is necessary. They have some economic stimulus measures in place, but leaders are concerned that they might overdo it, leading to high inflation. Indeed, euro zone leaders are taking a "wait and see" approach, reports the <a title="inflation, euro zone, euro forex trading, forex trading, trading U.S. dollar, U.S. dollar, ECB, economy" target="_blank" href="http://www.ft.com/cms/s/0/e52098b2-655a-11de-8e34-00144feabdc0.html?nclick_check=1">Financial Times</a>: <blockquote> The ECB believes the impact of its measures have still to feed through into the economy. But it faces a difficult balancing act. Even though the inflation outlook justified further action, the central bank feared “that more aggressive easing now could risk financial stability and or a too sharp acceleration of inflation over the longer-term,” said Nick Kounis, European Economist at Fortis Bank. </blockquote> Even with this news, the euro is heading a little bit higher in forex trading against the U.S. dollar. On top of that, in the long term the euro is expected to do well. The U.S. has racked up a lot of debt, and there are concerns that America has gone too far with economic stimulus -- increasing the probability of hyper-inflation. 9 application/xml false ECB economy euro forex trading euro zone forex trading inflation trading U.S. dollar U.S. dollar Euro in Forex Trading Forex trading with global currencies http://www.fx360.com/?aid=5704 Mozilla/5.0 (Macintosh; U; Intel Mac OS X 10.5; en-US; rv:1.9.0.11) Gecko/2009060214 Firefox/3.0.11 GTB5 127.0.0.1 127.0.0.1 mmarquit 63.248.48.57 false true false false true 128460 blog blogsite/GFTForex/web