Fabio Panetta’s comments came after European Central Bank chief Mario Draghi said on Thursday the ECB was studying new stimulus measures in a bid to spur economic growth and shore up inflation. Most Asian market currencies were higher during the trading session which is a clear indication of the institutional interest for emerging market equities at the moment of time.
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Sparse lending to companies has dogged the struggling euro zone economy although the picture improved slightly over the summer months before September’s dip. In the week after the European Central Bank (ECB) president signalled he is effectively in countdown to more stimulus, he will receive a raft of data from unemployment to inflation that will guide his decision on what is needed.
The Stoxx Europe 600 was up 2.1% early afternoon. Now that Mark Carney has also down played the possibility of a BoE rate hike; all we need now is the BoJ to fire off a few more QE and the Fed to also shirk from tightening monetary policy and then we may get back to the years’ high in time for Christmas.
The latest episode in central banks” ongoing “monetary wars’ was last week’s People’s bank of China (PBOC) cuts in deposit rates and base interest rates by 0.25%, accompanied with further cuts in reserve requirements for commercial banks by 0.5%. A cut to the deposit rate was forecast by 4 percent of respondents.
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UK’s benchmark FTSE 100 ended up 1.04 percent, the pan-European FTSEurofirst 300 ended the day up by 1.92 percent, Germany’s Dax ended up 2.78percent, France’s CAC finished the day up by 2.44 percent. The rally was triggered by strong earnings from Microsoft, Amazon and Google. He recommends buying five-year Italian securities. The prior figures were 21.8 billion and 65.9 billion. Two EUR-crosses stood out in particular this week, given their reaction to the European Central Bank and their respective ensuing significant responses: EUR/USD declined sharply by -3.00% to $1.1011, breaking its uptrend from the March, April, and July lows in the process (perhaps the beginning of a longer-term bear flag); and EUR/AUD dropped by -2.31% to A$1.5258 (losing its uptrend from the April, May, and June lows).
