Draghi’s playbook, Inflation Pressure, Border Friction: Eco Day

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Welcome to Wednesday, Europe. Here’s the latest news and analysis from Bloomberg Economics to help you start the day:

  • European Central Bank officials are taking a leaf from former President Mario Draghi’s playbook as they ask if recent market moves amount to “unwarranted tightening” that requires action
  • The ECB stepped up the pace of its emergency bond-buying last week after policy makers repeatedly warned that a recent rise in yields threatens to derail the region’s economic recovery
  • The rate the Federal Reserve targets to control monetary policy is defying the skeptics by holding firmly above zero, prompting a rethink from those who thought the central bank might need to step in and tinker with the front end
  • China’s producer prices rose at the fastest pace in more than two years in February, joining more expensive oil, computer chip shortages and soaring shipping costs as tailwinds for global inflation pressures
  • Friction at the U.K. border is rising again following Brexit as shipping companies rejected more cargoes due to cross the English Channel from France
  • Climate activists are urging the ECB to stop lending against brown bonds, arguing that marginal changes taking into account climate risks won’t sufficiently lower the institution’s carbon footprint
  • President Joe Biden’s soon-to-be-unveiled longer-term economic stimulus package is set for far tougher obstacles in Congress than the pandemic-relief bill that’s on the verge of squeaking through
  • The Bank of Canada could soon start pulling back stimulus, with the first clues on its next moves coming as early as this week
  • The global economic recovery is fueling speculation that central banks will soon be shifting into tightening mode -- nowhere more so than India
  • Some of the world’s biggest exporters in Asia are intervening to alleviate a shipping container shortage that jeopardizes their overseas trading

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