Dovish is the verdict (for now) on European Central Bank

Reuters

Most euro zone government bond yields fell 2-5 basis points, though the yield on Germany's 10-year government bond, the benchmark for the region, rose off session lows of 0.647 percent to trade at 0.65 percent by 1700 GMT - more or less flat on the day. A stronger euro could have an impact on European exports and affect prices in the region.

While the bloc's five-year growth run and a rapid drop in unemployment suggest that inflation will eventually rise, its rebound is still months away, complicated by the euro's rise against the dollar, which puts a lid on price growth.

Stocks in Europe and the United States also moved higher.

ECB chief Mario Draghi skirted the question of the strong euro in January by saying the bank did not target exchange rates, but he may be confronted on the currency again as economic momentum stalls after a strong start to 2018. The easing bias had stated that the European Central Bank stands prepared to increase purchases in terms of "size and/or duration".

The ECB is due to publish its economic forecasts on Thursday but significant changes to its estimates of future inflation and economic growth are not expected by economists.

The Governing Council also kept interest rates unchanged and repeated its expectation that borrowing costs will stay at present levels until well past the end of net purchases.

Meanwhile, US President Donald Trump is likely to provide further details about his plans to implement tariffs of 25 percent on steel and 10 percent on aluminum imports later in the day.

Residents of Syrian enclave left to flee as bombardment continues
One resident estimated that thousands of people were on the move and seeking shelter in areas further from the frontlines. Assad dismissed Western statements about the humanitarian situation in eastern Ghouta as "a ridiculous lie".

Investors were concerned that the proposed tariffs could trigger inflation and retaliation from USA trade partners, including the European Union (EU), China, and Canada.

The interest rate on the main refinancing operations, the marginal lending facility and the deposit facility remained unchanged at zero, 0.25% and -0.4% respectively. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. Regarding the Latvian banking scandal, Draghi said the ECB did not have enough information on the matter and was sending a letter to the European Court of Justice seeking a clarification on whether the detention of the central bank governor Ilmar Rimsevics were in compliance to the ESCB statute.

Which stocks were in focus?

"This is the first natural step toward normalization", said Piet PH Christiansen, an economist at Danske Bank A/S in Copenhagen.

Casino Guichard-Perrachon SA (CO.FR) fell 3.7% after the French retailer posted a sharp drop in 2017 profit (http://www.marketwatch.com/story/casino-profit-slumps-in-2017-as-sales-tick-up-2018-03-08). Hugo Boss shares fell almost 7 per cent after the German fashion house struck a more cautious tone on profit, while publisher Axel Springer sank 10 per cent after results triggered profit taking.

Draghi cautioned that the "rising protectionism" could harm growth in the eurozone.

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