EURO STRENGTH

Concerns about the strength of euro in the absence of inflation crop up again as French President Hollande noted earlier today, according to Reuters.

 French President Francois Hollande said on Thursday low inflation in Europe and an overvalued euro threatened a protracted stagnation, and called for an early euro zone summit to coordinate pro-growth measures.

"The recovery is too weak. Inflation is too low. The euro is too high," Hollande said at an annual ambassador's conference.

"Europe is threatened by a long and possibly interminable stagnation if we do nothing."

Hollande said pro-growth reforms France had already taken "cannot work unless all of Europe is mobilized also."

"At the side of monetary policy, there must be a budgetary policy which must play an important role to take into account situations, exceptional circumstances," Hollande said.

"The rhythm of deficit reduction must be compatible with growth goals and weak inflation."

This was Hollande's latest comment since shaking up the government over last weekend when he shuffled his cabinet in a new effort to revive France's sick and stumbling economy. Critics are calling for an end to any austerity emphasis and more pro-growth action.

The euro has remained stubbornly high in the face of efforts throughout the EU to stimulate more inflation which remains well below the official target rate of two percent.

In other European news the situation in the Ukraine apparently worsened as claims of Russian troops entering the country hit the airways. Coupled with the latest reports from the eurozone's consumer confidence index that dropped in August to 100.6 from July's 102.2 and the gloom continues to spread. Economists were expecting a number closer to 101.5.

Other reports have suggested sanctions are starting to squeeze Russia and the EU, adding to what many feel is further hurting an already feeble situation with unemployment in Germany, the EU's largest economy, still at 6.7 percent.