ECB excitement (that may be a slight exaggeration)
- The ECB meets, and should offer another impressive demonstration of masterful inactivity. Doing nothing is something the ECB is good at. We have not had any signal that there is an immediate desire to change policy.
- There is an interesting question as to whether the hurdle for additional quantitative policy is higher at the ECB than at other banks, because of the folk memory of hyperinflation in certain Euro area economies. Inflation below target merits accommodation, but not necessarily quantitative policy.
- Bank of England Governor Carney was at pains to avoid saying anything remotely controversial in his comments around the forthcoming EU referendum in the UK. Bailey and Cunliffe of the Bank speak today, but it is the retail sales data that is likely to attract market interest.
- The US is giving us more housing data – housing wealth matters to the markets, and construction matters to employment, so the housing sector is important, but markets probably get the message on that. The Kansas Fed survey is also due.