THE EURO slid to an 11-month low yesterday after grim signals that even the German economy was slowing down, while the currency union hovered on the edge of deflation.
The euro slipped to
When the index was last so low, in the final quarter of 2012, German GDP shrunk by 0.5 per cent, prompting renewed fears for the euro area's powerhouse economy. Second quarter growth figures will be revealed tomorrow, but analysts are already scaling back their expectations.
Global investors are rapidly souring on the Eurozone too -
There were more signs of deflationary pressure yesterday, with data confirming that the Portuguese consumer price index (CPI) dropped by 0.9 per cent in July, the deepest since 2009.
The euro overnight average interest average (Eonia) also fell to 0.01 per cent, the lowest in the euro's history. The index tracks rates at which Eurozone banks lend to each other.
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