LONDON (AFX) - The euro was higher in thin midday trade as the in-line German Ifo index failed to paint a worse case scenario for the German economy, dealers said. The West German Ifo business climate index rose to 84.9 in November from 84.7 in October, and was down from 97.0 in November last year. There are also expectations for the euro rally to continue if the European currency notes and coins are introduced smoothly on Jan 1, according to Razia Khan of Standard Chartered Bank. "We are seeing very good support for the euro at these levels and could see a sustained rally with the introduction of the coins and notes," Khan said. Sterling was stronger supported by the relative resilience of the UK economy, dealers said. "Sterling seems to be benefiting from the relative strength of the UK economy," Khan said. Jane Foley, economist at Barclays Capital, said sterling continued to nudge higher but still on the back of the euro-dollar cross. Sterling benefited after the euro pierced through technical resistance last Friday, she added. Thin trade in the run up to the Christmas holiday is exaggerating movements, dealers said. The yen continued weak ahead of the Bank of Japan's 2-day policy meeting which opens tomorrow. "There's still uncertainty about what the exact nature of the policy movements may be," Khan said. However, there seems to be growing official acceptance of a weaker yen, Khan said.