The euro was steady at $1.3530 at 8:15 GMT on Friday as data from the region suggested the economy was in trouble, and tension between Ukraine and Russia came to an all-time high after a commercial airline was shot down near the Russian border.
A Malaysian Airlines passenger aircraft was shot down near the border between Ukraine and Russia late on Thursday, leading to accusations from both sides that the other had used sophisticated weaponry and mistakenly shot the plane down.
The incident will likely increase the tension between Moscow and the West, as most believe that an international investigation into the crash will somehow lead back to Russia.
Meanwhile, more data from the eurozone further exacerbated concerns that the region could slip into a period of deflation. The Wall Street Journal reported that the European Union’s statistics agency released a report on Thursday, which showed that annual inflation in the bloc stuck at 0.5 percent in June.
The figure was unchanged from May and remained well below the European Central Bank’s two percent target.
The June figure is the bloc’s ninth consecutive month with inflation below one percent, something the ECB has labeled “the danger zone."
The bloc’s dismal inflation figures are making it more difficult for the heavily-indebted governments in Southern Europe to lower their debts and hurting the region’s competitiveness.
Although the European Central bank announced a new package of stimulus measures designed to combat falling inflation at its June meeting, most expect that it will take several months before the region sees any effect from the ECB’s efforts.
Additionally, many believe that the ECB hasn’t done enough to boost the region’s stalling economy and will be forced to ease again in the future.
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