SHANGHAI, Dec 11 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.
The euro rose on Thursday after the European Central Bank unveiled fresh stimulus measures broadly in line with expectations, while sterling fell after post-Brexit trade talks were extended to the weekend in hope of an elusive breakthrough.
The ECB increased the overall size of its Pandemic Emergency Purchase Programme by 500 billion euros ($605.40 billion) to 1.85 trillion euros and extended the scheme by 9 months to March 2022, with the aim of keeping government and corporate borrowing costs at record lows.
The move did not surprise investors as the central bank had made it clear more easing was on the way and bond purchases, along with liquidity facilities for banks, would form the backbone of any policy response.
Traders were still awaiting a press conference by ECB head Christine Lagarde for any comment on the recent rise of the currency on foreign exchange markets.
On Wall Street, stock futures were flat in overnight trading on Thursday as the future for additional fiscal stimulus remained uncertain.
Futures on the Dow Jones Industrial Average gained about 50 points. S&P 500 futures and Nasdaq 100 futures were both little changed.
The overnight action followed back-to-back losses for the S&P 500 as negotiations over a coronavirus relief deal dragged on. Lawmakers seek to pass a bill before lifelines expire at the end of 2020, but disagreements over state and local stimulus, unemployment assistance and stimulus checks still exist.
Senate Majority Leader Mitch McConnell’s staff informed congressional leadership offices that Senate Republicans likely would not support a $908 billion bipartisan proposal, according to NBC News. Earlier on Thursday, House Speaker Nancy Pelosi said that bipartisan negotiations were leading to “great progress.”
Without fresh stimulus, millions of Americans could lose unemployment benefits in the new year. Meanwhile, weekly jobless claims jumped last week to 853,000, the highest total since Sept. 19, as new lockdown restrictions weighed on businesses amid rising coronavirus cases.
Elsewhere, a key Food and Drug Administration advisory panel recommended the approval of Pfizer and BioNTech’s coronavirus vaccine for emergency use. The recommendation marked the last step before the FDA gives the final approval to broadly distribute the first doses throughout the U.S.
Oil surged above $50 a barrel on Thursday for the first time since early March as hopes of a faster demand recovery after the release of COVID-19 vaccines offset a huge rise in U.S. crude inventories that showed there was still ample supply available.
Britain began vaccinations this week and they could start as soon as this weekend in the United States. Canada on Wednesday approved its first vaccine and said initial shots would be delivered starting next week.
Oil gained even after the latest weekly report on U.S. oil inventories showed a massive, 15.2 million-barrel rise in crude stocks.
“The latest set of data has exceeded any bearish expectations,” said Tamas Varga of oil broker PVM. “The stubbornness of oil bulls and their confidence in the positive economic impact of the vaccine roll-out are truly remarkable.”
Concern over an attack on an Iraqi oilfield also lent support. Two wells at a small field were set ablaze by explosives on Wednesday, but overall production from the field was not affected.
Gold eased on Thursday as a failure to significantly breach the $1,850 per ounce resistance level prompted technical selling, with persistent overall vaccine-driven optimism also prompting investors to look past weak U.S. jobs data.
Key economic data slated for release today include German consumer price index (CPI) for November, US producer price index (PPI) for November and University of Michigan's Consumer sentiment index for December.
