© Dario Perkins
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I do not think it will continue at the pace that we saw in the Q1, because if we had big impact from constructions, it seems to be seasonal. Moreover we have a factor from a big rise in consumer demand, which has come from low energy prices that have already reversed. Thus, both of these factors will disappear. However, I also believe that there is a reason to get out, just not as strong as what we saw last quarter.
The EU statistic agency stated that the Euro zone's CPI dropped 0.2% year-over-year in April. Thus, the Euro zone's inflation has been in the negative territory for two consecutive months. In your point of view, should we expect some actions from the ECB's side any time soon or not? Why?
I think, they have already anticipated that, as they have moved already before the inflation number turned negative. I suppose, a lot of is coming from energy prices. Thus, I do not think they will react now, as the inflation should pick up quite quickly.
What will be the major drivers for EUR through the rest of the year?
It is going to depend on what is happening with central banks. If the Fed starts to raise interest rates more aggressively, that could push the Dollar up, which in its turn would depress the Euro. Moreover, toward the end of the year, I think, people will be starting to wonder about whether the ECB can extend its QE again, and that source can have a big bearing. I think it is going to be down to what those two central banks are doing.