The euro held losses against most of its major peers from last week before data forecast to confirm the region’s inflation slowed, boosting the case for additional monetary stimulus which tends to debase the currency.
The dollar was 0.2 percent from a four-month high versus the euro on speculation the Federal Reserve will further reduce monthly bond buying after the European Central Bank this month cut its deposit rate below zero. Demand for commodity currencies was supported after oil prices rose to a nine-month high amid escalating violence in Iraq.
“There was a pretty strong signal that the ECB could do more,” said Janu Chan, an economist at St. George Bank Ltd. in Sydney. “It’s the scale at which quantitative easing could occur that’s going to have a downward impact on the euro over the medium term, particularly if they surprise and put out some more drastic measures.”
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