Euro edges up as ECB launches QE programme

[NEW YORK] The euro inched higher Monday as the European Central Bank embarked on its long-awaited quantitative easing programme aimed at preventing the eurozone from sinking into deflation.

The 19-nation currency gained on the dollar and the yen, though it was slightly lower against the British pound.

The European Central Bank on Monday set out on a massive bond-purchase programme, its most audacious scheme yet to ward off deflation and stimulate growth in the single-currency area.

The quantitative-easing (QE) scheme is regarded as the ultimate weapon in the eurozone's fight to bring its flat-lining economy back to life.

Over at least 18 months the ECB plans to buy 60 billion euros' worth of bonds per month to lower long-term interest rates with the aim of fostering spending and investment.

But even as QE was launched, markets were focused on the more immediate risk of whether Greece can convince creditors of its commitment to reforms that will ensure it has the financing to avoid a default crisis or an exit from the eurozone.

The Greek government outlined its plans to eurozone finance ministers on Monday.

"Signs of renewed deadlock following the sit-down may reboot 'Grexit' fears, rekindling euro selling pressure," said Ilya Spivak of DailyFx.

AFP