Trump tariffs cast dovish shadow over European Central Bank

Trump tariffs cast dovish shadow over European Central Bank

All eyes will be on the European Central Bank for clues about the speed and timing of monetary tightening and any signs it is starting to grow uncomfortable with the currency's strength. Crude oil traded near $60 a barrel and gold slipped as a Bloomberg gauge of commodities slid for a second day. Recent geopolitical developments, such as heightened risk of a trade dispute and the recent elections in Italy, coupled with continuing low inflation have analysts projecting no change in the bank's forward guidance on its asset-purchase plan.

The Governing Council expects the key European Central Bank interest rates to remain at their present levels for an extended period of time, and well past the horizon of the net asset purchases.

The euro dropped to $1.2314 from $1.2411 late Wednesday in NY. But there is very very very little risk of an (ECB) dovish announcement. So, dropping the easing bias is actually "backward-looking", he said. Against the pound, the euro was 0.13% lower at £0.8916 and fell 0.65% to Y130.81 versus Japan's yen.

The Footsie steadied in the previous session, adding 11.09 points to close 0.16 percent higher at 7,157.84.

Only 27 percent of management positions were held by women at the end of 2017, compared to an interim target of 29 percent, and goals for senior management fell short by an even larger margin, the European Central Bank said in a statement published after the press conference.

"We'll be looking to infer what role the global external environment (stock market volatility and USA protectionism) is playing", he said.

The dollar had weakened sharply following the resignation on Tuesday of Gary Cohn, the top economic advisor to the White House who was seen as seen as a bulwark against protectionism in President Donald Trump's administration.

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Irrespective of the long-term outlook, markets, for now, are relatively calm.

Trump's impromptu announcement last week that he meant to slap 25 percent taxes on steel imports and 10 percent on aluminium revived the spectre of a trade war between the United States and major trade allies like Canada or the European Union.

Beijing's reporting of strong export data comes against the backdrop of increased trade tensions with the US.

While worries about USA tariffs may have eased somewhat, the dollar's recovery was limited as fears of trade conflicts lingered with Trump seen sticking to a protectionist stance in the longer run.

The inflation forecast for this year was maintained at 1.4 percent, while the outlook for next year was trimmed to 1.4 percent from 1.5 percent. It had weakened on Wednesday to C$1.3002 CAD=D4 on Wednesday before recovering on the prospect that Trump's tariffs may exempt Canada and Mexico.

The Mexican currency was at 18.68 pesos per dollar following its recovery from 18.90 touched on Wednesday. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives.