Investing.com - The euro was trading close to nine-year lows against the dollar on Tuesday as the rout in oil prices continued, fuelling fears over the impact on global growth and inflation.
EUR/USD was down 0.31% to 1.1795, not far from last Thursday’s lows of 1.1753, the weakest since December 2005.
Crude oil prices fell to almost six-year lows on Tuesday, pressured lower by concerns over a global supply glut. The rout in oil prices has fuelled concerns of exacerbating already low levels of inflation in many major world economies, including the euro zone.
Data last week showed that consumer prices in the euro area fell 0.2% in December from a year earlier, the first fall in the annual rate of inflation since October 2009. The European Central Bank targets inflation of close to but just below 2%.
The decline in consumer prices fuelled expectations that the ECB could implement quantitative easing measures as soon as its next meeting on January 22.
Earlier this month ECB President Mario Draghi said the risk of it not fulfilling its mandate of price stability is higher now than six months ago.
Elsewhere Tuesday, the single currency pushed higher against the pound, with EUR/GBP rising 0.17% to 0.7812 after data showing the annual rate of U.K. inflation rose at the slowest rate since May 2000 in December.
The annual rate of U.K. inflation slowed to 0.5% last month from 1.0% in November. Economists had expected a smaller decline to 0.7%.
The slowdown in inflation underlined expectations that the Bank of England will keep interest rates on hold at record lows for most of this year.