Financial Markets Daily Report 11 March 2022
Macroeconomic events and data releases shadowed latest developments of the Ukrainian war, as the ECB meeting and US CPI inflation centered stage in financial markets. On the latter, headline inflation rose as expected in February from 7.5% to 7.9% and core inflation rose from 6.0% to 6.4%.
- Macroeconomic events and data releases shadowed latest developments of the Ukrainian war, as the ECB meeting and US CPI inflation centered stage in financial markets. On the latter, headline inflation rose as expected in February from 7.5% to 7.9% and core inflation rose from 6.0% to 6.4% (more details here).
- Meanwhile, the ECB accelerated the end of net asset purchases under the APP. In Q2 it will buy €90bn worth of assets (previously planned €120bn) and in Q3 they can either cease or be extended depending on the evolution of the outlook. GDP and inflation forecasts were revised downwards and upwards, respectively (more details here).
- In this context, yields on euro area sovereign bonds surged and peripheral spreads widened (particularly so in Italy). Stock indices declined in both sides of the Atlantic and energy prices declined despite remaining at elevated levels. In FX markets, the euro weakened and fluctuated below $1.10.