Euro falls as German growth forecast slashed

<p>The euro has slipped in forex trading as Germany’s growth forecast is cut by Bundesbank.</p>

The euro has lost ground in forex markets versus the dollar and pound in trading this morning (December 7th) as the Bundesbank has cut Germany's growth forecast for 2013.

According to the financial institution this is because the country's economy may already be in a state of contraction, with expansion next year now anticipated to be just 0.4 per cent, compared with a forecast in June of 1.6 per cent.

However, Bundesbank reported there is expected to be a bounce back to 1.9 per cent in 2014.

In 2012, Germany is anticipated to grow by 0.7 per cent, which is down from an earlier forecast of one per cent.

"Bundesbank does not see a protracted slowdown, but instead anticipates a return to a growth path soon," the bank said.

At 10:45 GMT, the euro slipped in trading, sliding by 0.1 per cent versus the pound to €1 buying £0/806, while against the dollar it depreciated by 0.2 per cent to $1.293.

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