ECB leaves policy unchanged, drops reference to 'lower rates'

James Comey who was fired by Donald Trump as FBI chief last month is due to give testimony on Capitol Hill on Thursday

At 5:15 Easter hours, the euro was trading at 1.128 against the dollar and by 6:30 Eastern hours, the euro was down to 1.12 against the dollar.

It was later found that the euro suffered the move over a leaked inflation report, which was scheduled for publishing, during the interest rate decision of the European Central Bank (ECB).

The bank took a tiny step toward an eventual exit from the stimulus by dropping wording in its statement saying it could lower interest rates even further.

That's a sign of greater confidence in the economy, which is growing at a two-year high, confidence that ECB President Mario Draghi echoed in subsequent comments.

The evidence is piling up that the growth in the eurozone has kicked into a higher gear and the region is recovering from the Great Recession and the ensuing crisis over high debt that pushed some eurozone countries, notably Greece, to the brink of bankruptcy.

The euro zone economy grew by more than previously estimated in the first quarter and at its fastest rate in a year, European Union statistics agency Eurostat said today.

In previous statements, the European Central Bank had said it expected rates "to remain at present or lower levels for an extended period of time".

But the bank trimmed inflation forecasts for the next three years and said "substantial" amounts of stimulus through its unprecedented asset purchase scheme were still needed.

Britain's main opposition Labour Party leader Jeremy Corbyn seen campaigning in north-east England has been closing the gap on Conservative Prime Minister Theresa May in recent polls
Asian shares down ahead of Comey, ECB and UK election

Analysts expect that provision to be dropped in coming months as the bank edges toward announcing how it will phase out the bond purchases next year.

"Growth is so good, core inflation is so low", Michael Krautzberger, BlackRock's London-based head of European fixed income, said on Bloomberg TV on Thursday.

Though inflation in the eurozone is higher than it was for much of the past two years, that's largely because of a pick-up in oil prices. Inflation was expected to hit 1.7 per cent this year, 1.6 per cent in 2018, and 1.7 per cent in 2019.

All told, eurozone growth during the first quarter was double that of the USA, a welcome development for the central bankers at the ECB ahead of their latest policy decision Thursday afternoon in Tallinn, Estonia.

But the bank's announcement Thursday reiterated that its stimulus in the form of monthly bond purchases could be stepped up if the economic outlook worsens. The measure pumps newly printed money into the economy in an effort to raise inflation toward the bank's goal of just under 2 percent considered best for the economy.

The bank kept its short-term benchmark rate at a record low of zero. The ECB's refinancing rate remains 0%, while the rate paid on deposits left overnight at the central bank was held at minus 0.4%. That is in effect a tax aimed at pushing them to lend the money instead of hoard it.

The issue the ECB's policymakers must confront when they meet in Tallinn on Thursday is whether the recovery is strong enough to manage without so much monetary stimulus - whether in the words of one, it has attained escape velocity.

Related News:

  • To US diplomat in China quits over Trump's climate policy

    David Rank , a 27-year veteran of the State Department, has been running the embassy in Beijing as chargé d'affairs since January. Arnold Chacon had served as the director general of the foreign service and director of human resources.

    Girl, 8, Banned From Soccer Game For Looking Like Boy

    She told the local NBC affiliate, "When my hair starts to grow I cut it short because I've always had short hair". By Monday she was back to dribbling a soccer ball and obsessing about her favorite team, Guadalajara's Chivas.
    Ariana Grande planning benefit concert in Manchester

    Ariana Grande planning benefit concert in Manchester

    Britain's terror threat assessment has been raised to "critical", the highest level, meaning an attack is considered imminent. Associated Press writer Jill Lawless reported this story from London and AP writer Mstyslav Chernov reported in Manchester.
  • Ranking US diplomat in China resigns

    Rank joined the State Department in 1990 and served in a variety of roles including in Afghanistan, Greece, and Mauritius. Baucus's replacement, Branstad, was confirmed by the Senate last month but hasn't arrived in China yet.

    Goldman's Venezuelan bond deal a 'cynically opportunist bet:' Fmr. Goldman managing director

    Opposition politicians said at least 89 people were injured when protesters clashed with security forces blocking their way. Congress to probe the deal, which lawmakers said will prop up the country's embattled president.
    Athletic Bilbao announce Barcelona target Ernesto Valverde will leave the club

    Athletic Bilbao announce Barcelona target Ernesto Valverde will leave the club

    The move follows weeks of speculation which heavily tipped the 53-year-old as Barca's preferred successor to Luis Enrique . Valverde played for the Blaugrana from 1988 to 1990 and won a UEFA Cup Winners' Cup and a Copa del Rey with the club.
  • Ten people remain in critical condition after London Bridge attack: Health Authority

    Ten people remain in critical condition after London Bridge attack: Health Authority

    She said a woman was stabbed right in front of them, and two of his friends managed to run away, losing him in the commotion. Two unarmed police officers have been hailed as heroes for their bravery in taking on the London Bridge terrorists .
    Tiger Woods: What happened and what next on and off the course

    Tiger Woods: What happened and what next on and off the course

    It left players on the PGA Tour hopeful for better times, and not just on the golf course. "I feel bad for Tiger", Nicklaus said. Woods' current sponsors - including Nike, Bridgestone and Monster Energy - did not immediately comment on Tuesday.
    EU, China to reaffirm support for climate pact

    EU, China to reaffirm support for climate pact

    Trump name-dropped the city in his speech, stating: "I was elected to represent the citizens of Pittsburgh, not Paris ". Opinions were split over Trump's decision to remove the US from the pollution-reduction deal.
  • Philippine lawmakers ask top court to nullify martial law

    Philippine lawmakers ask top court to nullify martial law

    The SC is expected to tackle the petition today as it resumes full court sessions after a month-long decision writing period. In the same proclamation, Duterte also suspended the privilege of the writ of habeas corpus in the region.

    'Peace Is A Choice,' Trump Says During Appearance With Palestinian Leader

    Trump also said that Iran should have thanked the USA for the 2015 nuclear agreement, because it led to sanctions being lifted. Back in Jerusalem, Trump gave a speech at the Israel Museum, where he said "my administration will always stand with Israel".

    Trump waives law requiring US to move embassy in Israel to Jerusalem

    Hussam Zomlot, Palestinian ambassador to the United States , also issued a statement . "We're looking at it very, very strongly". Bush and Barack Obama before midnight, the decision to make the historic move will have been made by non-action.


Most liked

Trump Team Stands by Budget's $2 Trillion Math Error
Meanwhile, it calls for cutting over $800 billion from Medicaid , the federal health program for the poor , over the next decade. The New York Times analyzed Trump's budget , and found it targets programs that tend to spend more on women than men.

Chinese president Xi, California governor pledge action on climate change
The pair met soon after the top USA diplomat in China resigned, allegedly in protest of Trump's Paris decision. Trump's withdrawal from the Paris Agreement signaled that the US has abdicated its role as world leader.

Champions Trophy: Rumman Raees replaces injured Wahab in Pak squad
He has 64 wickets at 25.18 from 42 List A appearances, and 123 first-class wickets, with career-best figures of 7-31. Riaz injured himself during the opening game of Pakistan's Champions Trophy 2017 against India at Edgbaston.

Real Madrid win Champions League Final 4-1 in Cardiff
In the run-up to the final , it sounded like Juventus were favourites and were playing a team who'd reached the final by chance. On average, the Real Madrid celebrations delivered 900,000 viewers and a 5.7% share for the DTT network.

Jose Mourinho Keen To Swap De Gea For Alvaro Morata
Chelsea divided between Lukaku & Morata. " Milan? No, I certainly won't be in Italy", he told Mediaset Premium . Manchester United have had a €60m bid for Alvaro Morata knocked back by Real Madrid , according to Sky Italia .

Baltimore Ravens sign two cornerbacks, release Kyle Arrington
He signed with the Carolina Panthers during free agency in 2016 but was cut about two months later and joined the Bears. The Bears signed him to a one-year contract last spring, but the injury landed him on injured reserve in August.

Ariana, others perform in Manchester as tribute to attack victims
Grande performed throughout the show, even collaborating with others onstage. Twenty-two people were killed and dozens more injured in the incident.

UK Police Declare London Bridge, Borough Market Incidents as Terrorism
Witnesses have described seeing a speeding vehicle veer into crowds on London Bridge and people being stabbed in Borough Market . The force initially said officers were also responding to a reported third incident, in the Vauxhall area of London .

Austin joins SA in lawsuit to sanctuary cities ban
Shortly after its signing, the American Civil Liberties Union (ACLU) issued a travel warning for the state of Texas. So far, El Paso, San Antonio and Austin are all suing the state - even the small border town of El Cenizo .

Nintendo Switch Online Details Announced
The app can be used to chat with your other Switch-owning friends, invite them to play a game online, and set "play appointments". Initially, the company mentioned that subscribers could play a classic NES or SNES title for only one month.

Question Time: Leaders Special
The audience were very vocal when Ms Rudd asked voters to "judge (the Conservatives) on our record". "Don't give her yours".

Taylor Swift faces jury trial in DJ assault case
Mueller, who originally sued the star for loss of wages, has always maintained Swift was groped by another worker at the station. Swift has promised to donate any money she's awarded as a result of the trial to charities for victims of sexual assault.

Tegna (TGNA) Receives Daily Media Impact Rating of 0.16
With 1.50 million avg volume, 5 days are for Tegna Incorporated (NYSE:TGNA)'s short sellers to cover TGNA's short positions. Before becoming president and CEO, Lougee was president of Tegna Media, overseeing 46 broadcast stations in 38 markets.

Then there were 4: Fifth Harmony releases first track minus Camila Cabello
Especially as a songwriter. "You'll hear our growth and maturity reflected in the music we're creating". The group is now in the studio working on their highly-anticipated third album.

White House says Trump expected to pull US from Paris deal
In fact, he said, sea level rise caused by unchecked climate change could mean that cities like his "will cease to exist". He could announce that the United States is abandoning the agreement, but it would take until 2020 to actually leave.