Euro zone growth revised up to highest rate in two years

Euro zone growth revised up to highest rate in two years

Eurostat said the 19-country euro zone expanded by 0.6% quarter-on-quarter and by 1.9% year-on-year.

The euro fluctuated after the decision, dropping to US$1.12165 from US$1.1241 following the statement.

The ECB sees the need for continued and substantial monetary easing to secure sustained inflation rates. It now expects consumer prices to rise by only 1.3% next year, some way below its target of just below 2%.

"Headlines suggesting that the European Central Bank will revise its inflation forecast lower through 2019 suggests that the hawks will struggle to make the case for an early normalization of the ECB's policy settings", says Shaun Osborne at Scotiabank.

The meeting of the ECB's governing council was dedicated above all to slight corrections to their communication, explaining that the risks for growth are now "broadly balanced" and no longer tilted to the downside.

But Mr. Draghi also warned inflation would remain weak over the coming years, and said European Central Bank members hadn't discussed winding down their EUR60 billion-a-month bond-purchase program.

Sterling is set to remain volatile due to Brexit uncertainty.

Draghi said the central bank would remain poised to extend its accommodative monetary policy if necessary.

The bank left interest rates unchanged in the June meeting and dropped any mention of a rate cut.

Market participants were turning their attention to ECB President Mario Draghi's press conference at 12.30 GMT, for the banks assessment of the euro area economy.

The previous projections in March foresaw rates of 1.7%, 1.6% and 1.7%, respectively.

David Zahn, head of European fixed income at Franklin Templeton, believes accommodative monetary policy could extend into 2019.

Speaking in Tallinn, Estonia, on the bank's annual trip away from its headquarters in Frankfurt, Draghi said that the bank could still expand its QE programme, also known as the APP (asset purchase programme), despite a widespread belief in the markets that QE will be gradually reduced from the end of 2017 onwards.

The more important driver for the market, di Galoma said, was the expected rate hike by the Federal Reserve next week as well as USA long-dated Treasury debt auctions.

The euro area growth forecast for this year was raised to 1.9% from 1.8%.

Policymakers also reiterated their pledge to increase the size or duration of the bond-buying programme if the economy deteriorates. The central bank will continue to buy €60bn of bonds, including government debt, each month until at least the end of the year.

Saxo Bank's John Hardy told CNBC ahead of the announcement that he believed any immediate dip in the euro during Thursday's meeting would be short-lived, but added that the leak may have been used to prevent a euro rally.



Related Posts

Grenfell Tower: After the horror, anger flares in west London
There have been calls for a major investigation amid questions about how the fire spread so rapidly through the block. Families of those thought to have been in London's Grenfell Tower are desperately searching for missing loved ones.

A ton of new features with iOS 11
Now the iPad is set to get several long-awaited features which should make it perform more like a traditional computer . However, if you want it before everyone else, you can sign up for Apple's beta program and download iOS 11 right now.

Serbia draw 1-1 with Wales in World Cup qualifier
Wales were always likely to sit deep and hope for a break, especially without the suspended Gareth Bale , and so it proved. Asked about the consequences of missing in that fashion, he replied: "That is the risk you take".

Warriors' Game 5 win wraps up highly-watched NBA Finals
Kerr still found time to crack a joke on the stage afterward: "Well, we had very little talent, actually, it was mostly coaching". Smith kept the Cavs in it with two big 3-pointers in the final minute, including a 28-foot heave just before the halftime buzzer.

List of GOP lawmakers found in Virginia shooter's pocket
His Facebook posts attacked the president, including one stating, "Trump is guilty and should go to prison for treason". Jack Sava, director of trauma at MedStar Washington Hospital Center said at a news conference Friday afternoon.

Champions Trophy: England knocks out Australia with with a 40-run
The 30-year-old Henriques has never made more than 18 in an ODI and failed with the bat in two innings and took just one wicket. They are joined in the semi-finals by unfancied Bangladesh , who beat New Zealand in Group A on Friday.

Ralph Northam wins Democratic nomination for governor
He'll have his work cut for him; Democratic turnout exceeded Republican turnout in Tuesday's primary by roughly 150,000 votes. A low-key pediatric neurologist, Northam delivered a fiery victory speech Tuesday before winning the Democratic primary.

Who was present during the GOP baseball practice shooting
The GOP lawmakers that make up a 34-member team had been practicing for Thursday's annual charity congressional baseball game. Hodgkinson, who died later, had been hanging out for weeks - often early in the morning -at the YMCA next to the park.

IOS 11 Brings FLAC File Support to iPhones and iPads
All the keys will be smoothed over to one side so you can type with one hand. iOS 11 is an absolute game changer for the iPad . Other big addition to Siri is a new translation feature that lets user translate English words to other languages.

Google's Pixel Launcher Crosses the 1 Million Downloads Mark
According to the information discovered in the Android Issue Tracker, LG could be the manufacturer for the next Pixel XL device. A recent report published on Android Police says that Google won't be coming out with the device that was codenamed muskie.

© 2015 Chester Weekly. All Rights reserved.