In its monthly report published on Monday, Germany's Bundesbank noted that the economic outlook was somewhat brighter with the short-term outlook turning more favorable than seen just a few months ago.

"At the turn of the year, sentiment among entrepreneurs and consumers worldwide brightened slightly, with recessionary fears receding somewhat," the publication read.

Bundesbank further noted that high inflationary pressures remain in place as the second round impact of quick wage growth is expected to keep Eurozone inflation above its target for an extended period of time. 

Market reaction

EUR/USD continues to fluctuate in a very narrow range at around 1.0700 following this publication.