- Dennis de Jong, managing director of UFX.com
German inflation cooled further in February, reinforcing the view the European Central Bank will deploy additional stimulus measures as soon as next month. Inflation in the Euro zone's powerhouse, was breakeven on an annual basis, sharply falling from the 0.5% growth in January, according to the Federal Statistics Office. In monthly terms, however, the reading recovered and added 0.4% in February, compared with the 0.8% decline in the preceding month. The so-called Harmonized Index of Consumer Prices, showed inflation dropping 0.2% year-on-year, sharply down from January's 0.4% rise. Measured on a monthly basis, prices increased 0.4% in February, following the 1.0% decrease seen previously.
Meanwhile, the French economy surprisingly maintained a solid pace of growth in the final quarter of 2015. GDP in the Euro zone's second biggest economy expanded 0.3% in the last three months of 2015 after growing at the same pace in the third quarter, statistical office INSEE reported. Exports rebounded and climbed 1.0% after falling 0.6% previously and imports accelerated to a 2.5% expansion after surging 1.7% in the third quarter. Overall, foreign trade balance contributed negatively again to GDP growth: -0.5 points following -0.7 points. Conversely, changes in inventories contributed positively by 0.7 points, the same as in the previous quarter.
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