The euro consolidated its gains on Tuesday after data showed the eurozone economy grew in line with expectations during the fourth quarter.
Official data showed the eurozone economy expanded at a 0.6% pace quarter on quarter in the final three months of 2017, in line with market expectations.
It means the eurozone grew by 2.5% over the 2017 calendar year, its best performance in a decade.
At the same time, Eurostat upwardly revised third-quarter growth to 0.7% quarter on quarter, up from its prior 0.6% estimate, implying a modest deceleration on a quarterly basis in the final three months of 2017.
Separate data from the European Commission also showed economic sentiment in the eurozone dipped in December, falling to 114.7 versus a 17-year high of 115.1 registered in December.
The moderation was attributed to a decline in sentiment in the retail sector.
While the euro pared some of its earlier gains of Tuesday´s session in the immediate aftermath of the data release, the single currency rapidly resumed its upward march in late morning trade.
The euro was up 0.4% and 0.19% against the dollar and sterling respectively as at 1122 GMT.
Continued strength in the eurozone economy may well prompt the European Central Bank (ECB) to adopt a more hawkish stance in 2018, especially as the US Federal Reserve is expected to plough on with its rate tightening cycle.
The ECB has been keeping interest rates at ultra-lows, having also opted to extend its quantitative easing programme until September, albeit at a reduced rate of €30bn per month from the beginning of 2018 versus €60bn previously.
“Whether the ECB brings an end to its monthly bond-buying programme earlier than September will depend on the first quarter economic data but, even then, it seems unlikely. We should not expect any announcement before April,” said Jacob Deppe, head of trading at online trading platform Infinox.