Stable job creation, as well as surging business and consumer confidence, has caused many economists to upwardly revise their economic forecasts for several major European economies.
With the euro zone seeing its best economic growth in a decade, the ECB should gradually shift its stance to avoid a more disruptive move later, accounts of the central bank’s December meeting showed when published on January 11.
The minutes prompted the euro to surge against the dollar, extending the single currency’s rally throughout the opening days of the calendar year. The euro has gained more than 2 percent since the start of 2018 as a broadening recovery bolsters expectations the ECB may be forced to unwind its policy stimulus quicker than forecast.
Euro strength remains one the main challenges the central bank needs to contend with over the coming months, as a stronger currency tends to soften inflation by making exports more expensive and imports cheaper.
