The European Central Bank will not tighten policy to counter surging inflation as the rise is temporary and due almost entirely to rising oil prices, ECB President Mario Draghi said on Monday, brushing aside calls for the ECB to reduce stimulus.
Super Thursday marks the day once a quarter when the Bank of England announces its latest monetary policy decision, releases the minutes of the meeting, its quarterly inflation report including new forecasts and Governor Mark Carney chairs a press conference. Needless to say, it’s often quite an eventful day, particularly in post-Brexit Britain when so much uncertainty exists for the economy.
The euro slipped to a 11-day low against the dollar on Monday after German inflation data came in slightly weaker than expected, which took some pressure off the European Central Bank to wind down its stimulus program.
The dollar recovered from its worst run since August on Thursday, rising 1 % against the yen and around half a percent against the euro and pound as investors refocused on the chances of higher U.S. inflation and growth.
A month ago, the dollar and stock markets were riding high as investors bet that the Trump administration, together with the Republican-controlled Congress, would usher in an era of lower taxes, more government spending and looser regulations.
A strengthening dollar and a "race to the bottom" on taxes, deregulation and trade policy are the major risks to an otherwise brightening global economy, financial leaders said on the final day of the World Economic Forum in Davos.