Euro zone inflation edges up

Euro zone inflation rose in April, reducing chances the European Central Bank will act soon to ward off potential deflation, although it was below forecast and still within the ECB's "danger zone" of under 1 percent, according to Reuters. Annual consumer inflation in the 18 countries sharing the euro nudged higher to 0.7 percent in April from March's 0.5 percent, which was the lowest since late 2009, the European Union's statistics office Eurostat said on Wednesday. The reading was lower than the 0.8 percent predicted in a Reuters poll despite higher spending over the Easter period, reflecting the poor state of the euro zone economy after a long recession and withunemployment at near-record levels. The euro briefly fell to a two-month low versus sterling on the data but then recovered, with some traders saying they expect markets to gain because the immediate chances of radical steps by the ECB are now lower. "There's a small relief rally because the probability of ECB action just fell considerably," said a currency trader in London who declined to be named. April's reading takes inflation back to where it was in February but it is well below 1.2 percent of April 2013.