Weidmann Says ECB Will Act When The Time Is Right

The euro traded at $1.368 at 5:30 GMT on Tuesday morning and avoided fallout as emerging currencies continued to tumble under pressure from a slowdown in China and the possibility that the Federal Reserve will taper its asset buying program at its next meeting. The common currency has been treading water as investors wait for more data from the region for a better idea of the European Central Bank's plans at next week's policy meeting.

Over the weekend, several policy leaders called on the ECB to help prevent a period of deflation in the eurozone by taking preemptive action against the region's declining inflation. However,

reported that ECB governing council member Jens Weidmann told reporters that the bank would act at the right time in order to prevent inflationary problems. Many have been comparing the current situation in the eurozone to that of Japan, which faced a two decade period of deflation. Eurozone inflation fell to 0.8 in December, well below the ECB's 2 percent target and closer to falling below zero. The ECB will be in a tough position at its upcoming policy meeting as the region hangs in a very delicate balance. Unemployment in the region remains as the other big concern as the bloc's jobless rates remain unreasonably high. The lack of jobs has been especially hard hitting for young people, who face unemployment rates of around 50 percent in some countries. The result has been the rise of anti-euro political parties, advocating for nationalism and countries' exit from the euro. In Germany, the nationalist AfD party has been gaining support from young people, which could help the party get a seat in the European Parliament in the May elections.