ECB's Constancio concerned if euro moves don't echo fundamentals

"I am concerned about sudden movements which don’t reflect changes in fundamentals," ECB Vice President Vitor Constancio said when asked about the recent strength of the single currency in an interview with Italy’s La Repubblica newspaper. "Looking at fundamentals, inflation declined slightly in December".

The ECB faces renewed uncertainty over the inflation outlook as upward momentum from oil and robust economic growth is countered by the downward pressure from the exchange rate. Constancio's remarks also come amid a debate that has recently been dominated by speculation over an adjustment to policy wording early this year, and by renewed calls for a firm end-date for asset purchases.