Italy’s Economy Outpaces Eurozone Peers as Investment Spending Fuels Growth 
100+ Global Companies Push Governments to Prioritize Electrification for Economic Growth 
Oil Prices Steady as U.S.-Iran Truce Uncertainty and Middle East Tensions Keep Markets on Edge 
Japan Inflation Stays Below BOJ Target Despite Rate Hike and Rising Energy Cost Risks 
China’s AI Manufacturing Boom Masks Weak Consumer Economy, Citi Says 
BOJ Signals More Rate Hikes as Inflation Risks Rise Amid Energy Price Pressures 
Europe EV Demand Surges as Fuel Prices Rise Amid Iran Conflict 
Dollar Holds Firm as U.S.-Iran Talks Ease Tensions, GBP/USD Slips Amid UK Political Uncertainty 
France Faces Long Road to Economic Rebalancing as Weak Demand and High Rates Weigh, Says Citi 
Gold Price Rises as Investors Weigh U.S.-Iran Talks and Fed Policy Outlook 
German Finance Minister Wolfgang Schaeuble in its latest speech called on the bank to unwind ‘ultra-expansionary policy’ in 2017. While the bloc’s inflation quickened to a three-year high of 1.1 percent y/y in December 2016, Germany’s gauge accelerated to 1.7 percent y/y. Bundesbank cautioned that inflation could reach 2 percent in January 2017, given the firm growth momentum.
ECB President Mario Draghi at the central bank's January meeting repeatedly pointed out that he and his colleagues were particularly keen to ensure that the rise in inflation was “sustainable”. Without a rise in core inflation from current levels just below 1 percent the ECB will have to stick to its ultra-expansionary monetary policy.
Meanwhile, forward Eonia bank-to-bank rates dated for the ECB meeting on Jan. 25, 2018 have risen to around minus 0.30 percent, some 5 basis points above the overnight rate of minus 0.35 percent. According to analysts this gap suggests markets are pricing in around a 50 percent chance of a 10 basis point hike in the ECB's minus 0.40 percent deposit rate by next January.
