Euro dips against dollar in London

The euro fell against the dollar on Thursday after data showed German inflation sinking to its lowest since February 2010 in November, reinforcing bets the European Central Bank will ease monetary policy more aggressively. Oil-rich Norway's crown slid crown slid 1 percent to 8.6190 per euro as Opec kept oil output unchanged despite a huge global oversupply. The crown earlier hit a three-week trough of 8.6350 per euro as Brent crude slid to a four-year low.
Though German consumer sentiment picked up, annual inflation in the euro zone's biggest economy slowed to 0.5 percent from 0.6 percent in October. That will put extra pressure on the ECB to introduce further measures to shore up inflation and boost growth in the faltering monetary union.
-- US markets closed for Thanksgiving holiday Spanish consumer prices fell by 0.5 percent year-on-year, fuelling concerns that deflation is taking hold in the bloc's fourth-largest economy. "If inflation does continue to come down like this, that is going to increase the pressure on the ECB to take action," said Ian Stannard, head of European FX strategy at Morgan Stanley in London. But he did not expect the ECB to announce any new measures at its policy meeting next week.
Preliminary data on Friday is expected to show euro zone-wide inflation slowing to 0.3 percent, deep into the ECB's "danger zone" of under 1 percent. The euro fell back under $1.25, having traded as high as $1.2524 earlier in the day. It was last down 0.1 percent at $1.2494 in thin trading, with US markets closed for the Thanksgiving holiday.
European Central Bank President Mario Draghi said last week that buying sovereign bonds was an option to ward off deflation. Vice President Vitor Constancio said on Wednesday the bank could decide on such a move as early as the first quarter of 2015. The dollar hit an eight-day low against the yen of 117.24 yen, continuing its retreat from a seven-year high hit last week, after lacklustre US data on Wednesday. "Market participants are taking this opportunity to trim some of their accumulated dollar long positions. As far as dollar/yen is concerned, there is also firm bargain-hunting demand on dips," said Junichi Ishikawa at IG Securities in Tokyo.