Luxembourg’s central bank chief Mersch says that the euro zone economy will grow by the middle of next year but that the rebound will be rather subdued. Hard data is lagging survey data, the latter of which has been more optimistic, he says (Things like Ifo and ZEW have been more upbeat than employment and GDP reports…)
Deflation risks have decreased and inflation risks will grow in 2010, he says. He refused to comment on recent liquidity injections, saying it is premature.
EUR/USD is firmer, now at 1.3960, relecting a recovery in US equities and a rush to cover intraday short positions.
