Currency is still seeking credibility

The euro has been under pressure in the world's currency markets and European assets remain out of favour, partly because of the flow of good news from elsewhere. Europe has been unable to attract investors' attention despite its continuing low inflation, reducing budget deficits, a trade surplus and signs of a revival in output. As a result, the euro has fallen in value to become highly competitive in trade, providing the opportunity for an export-led recovery among the euro-11. Interest rates are still low at 3% and Europe has built up a considerable stock of excess liquidity since 19...