The euro currency sunk to 1 year low versus the US dollar at 1.2815, after Benoit Coeure, European Central Bank board member, confirmed that the bank was on a research for further strengthening of the real economy lending, especially the Small and Medium Enterprises (SME) sector.
It was reported that probably ECB would stick to its course of monetary policy easing in the future months due to Euro zone struggle to return to economic growth.
Meanwhile, Governing Counsil member Joerg Asmussen gave a warning that some regions in the single currency zone could be faced by a decade of adjustment, as European policy makers could decelerate the extent of budget restrictions enforcement and embrace a more expansive monetary policy. He also added, that monetary policy was to remain expansive as long as needed, because governments of countries under euro currency became more dependent on monetary support.
Earlier today rumors appeared that ECB was to test whether banks are up to the challenge of facing a possible negative interest rate on deposits in the region, which caused an initial decline of EUR/USD to 1.2857.
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