SINGAPORE (Reuters) – The euro inched lower on Tuesday, taking a breather after having rallied on the back of optimism about the euro zone’s economic outlook and expectations for the European Central Bank to wind down its massive monetary stimulus.
Comments by the Estonian central bank chief and ECB rate-setter Ardo Hansson on Monday reinforced those expectations, with Hansson telling a German newspaper that the ECB could end its 2.55 trillion euro bond-buying scheme in one step after September if the economy and inflation develop as now expected.
The euro eased 0.1 percent to $1.2253 EUR=, edging away from Monday’s peak of about $1.2296, its strongest level since December 2014.
Market participants, however, said they expect the euro to remain on solid footing in the near term.
“The markets are going to continue on with this trend,” said Stephen Innes, head of trading in Asia-Pacific for Oanda in Singapore, referring to the euro’s recent gains.