The latest euro zone flash purchasing managers’ indexes may have surprised slightly on the higher side, but many are still not convinced that better economic growth is coming later this year.
Slightly more than a year ago, the European Central Bank launched, with as much fanfare as can be expected from a central bank, a new incentive programme for commercial banks to lend to euro zone businesses, which they had been doing less and less of over the previous few years.
from Rahul Karunakar:
Almost a year after the European Central Bank announced new cash loans tied to actual lending to small and medium enterprises, data on Friday is expected to show euro zone private loans are picking up pace.
The recent green shoots emerging out of the euro zone economy could look a little more leafy on Thursday when data is likely to show a long-awaited recovery in private bank lending is starting to pick up pace.
The head of euro zone finance ministers urged Greece on Monday to “stop wasting time” and buckle down to serious talks on implementing a reform programme to secure urgently needed funds from its international creditors.
The world’s major central banks have long followed the same general flight path, guided by the economic winds of growth, inflation and financial markets. It has worked pretty well for policymakers in the United States, Europe, Japan, and the United Kingdom: moving together to tighten or loosen monetary policy makes things more predictable for citizens, businesses and investors. It also serves as buffer to any volatile currency movements, at least among developed economies. But six years after the worst recession in decades, this could be the year central bankers split off and – with some risk – go their own way.