The euro slumped to a fresh two-year low against the dollar on Monday, pressured by persistent worries over the Eurozone’s economic health and expectations of further monetary stimulus from the European Central Bank (ECB).

The shared currency touched $1.2660, its weakest level since August 2012, before recovering slightly. The decline reflects growing concerns about the region’s sluggish growth, low inflation, and the potential for deflation.

Recent economic data has painted a bleak picture of the Eurozone economy. Germany, the region’s largest economy, has seen a slowdown in manufacturing activity, while France continues to struggle with high unemployment and weak growth.

The ECB has already implemented a series of measures to stimulate the Eurozone economy, including cutting interest rates to record lows and launching a program to purchase asset-backed securities. However, these measures have so far failed to significantly boost growth or inflation.

Analysts expect the ECB to announce further easing measures in the coming months, potentially including quantitative easing (QE), which would involve the central bank buying government bonds. Such a move would likely put further downward pressure on the euro.

The dollar, meanwhile, has been strengthening against a basket of currencies, supported by the improving US economy and expectations that the Federal Reserve will begin raising interest rates next year.

The divergence in monetary policy between the ECB and the Federal Reserve is expected to continue to weigh on the euro against the dollar in the coming months.