Euro Steady Above $1.23 Ahead Of ECB Meeting

The euro was steady above $1.23 on Thursday morning as the European Central Bank began its monthly meeting. The common currency traded at $1.2323 at 8:06 GMT as investors placed their bets on whether or not the bank was planning to ease further.

PMI data out on Wednesday compounded worries about the bloc’s fourth quarter performance as the figures showed that firms throughout the region cut their prices yet again, something the ECB will likely consider while deciding whether or not more stimulus is necessary. Market’s final Composite Purchasing Manager’s Index for the eurozone in November came in a 51.1, down from 52.1 in October. The figure’s steady decline toward the 50 reading that separates expansion and contraction was worrying.

Based on the poor PMI figures, economists at Markit see the eurozone’s fourth quarter GDP coming in at just 0.1 percent. Furthermore, the data firm sees a good possibility that the region’s stalling growth could turn into a contraction in 2015 if nothing is done.

Though there is growing evidence that the ECB will need to step in, some of the bloc’s finance ministers are hesitant to roll out a wide scale easing program without further reform within individual eurozone nations. Germany has been very vocal about its disapproval of a quantitative easing package, despite the country’s own recent struggles with economic stability.

However, the Wall Street Journal reported that both Germany and France expressed support for a 300 billion euro investment plan proposed by the European Commission. Commission President Jean-Claude Junker proposed that as the bloc’s two largest economies, Germany and France set up their own projects to expand digital networks and energy efficiency in an effort to boost investment. For the moment, Germany has pledged to contribute just 10 billion euros over three years to the plan, but many are weighing on the nation to increase that figure to 24 billion euros.