- Eurozone inflation misses forecasts, while growth and jobs beat expectations
- Stock markets turn bullish
The euro dropped after key economic data missed expectations. The single currency shed 0.1% so far today after inflation slowed to 1.4%, under the forecasts of 1.5%.
The shared currency plunged to $1.15 on Thursday, after the European Central Bank said it would reduce but extend its stimulus programme. Policymakers will be closely watching the inflation data, the missing ingredient to the eurozone’s economy. The central bank is aiming for 2% inflation.
Meanwhile, growth in the region came in at 2.5%, marginally beating forecasts. Unemployment rates also beat expectations, coming it at 8.9%. The positive data somewhat cushioned the fall for the euro.
After a choppy overnight session, European stocks are trading upwards. France’s CAC 40 is 0.3% higher, while Spain’s IBEX 35 is 0.7% stronger. Spain’s stocks have been supported by recent polls showing Catalan separatists are falling behind pro-Spanish candidates.
The bank of England will meet on Thursday to reveal its interest rate decision. The central bank is expected to increase the cost of borrowing. In the run-up to the decision, the pound is 0.29% stronger against the greenback.
The dollar is flat against most major currencies as investors await Donald Trump’s decision on the next Federal Reserve chair.
The greenback has recently rallied on reports that Trump will choose a more hawkish Fed chair than Janet Yellen.
US stocks have rebounded after yesterday’s slump. Wall Street’s S&P 500 is 0.17% stronger and the Nasdaq 100 edged 0.4% higher.
Tax reform in the US still remains in focus, with lawmakers looking at a phase-in plan.
The US central bank will meet on Wednesday to divulge its latest interest rate decision.
Oil prices are flat after Brent oil touched its highest point in over three years yesterday. The international benchmark is now trading at $60.50, while the US benchmark is trading at $54.03.
Gold slid 0.3% as investors shy away from risker assets.