The European Central Bank held its benchmark rates unchanged on record lows. ECB head Mario Draghi emphasized that the central bank will gauge the need for further stimulus early next year, as he unveiled “substantially” lower forecasts for inflation and growth. Draghi said that the ECB intends to move its balance sheet towards the dimensions it had at the beginning of 2012. So far such an increase was “expected” rather than “intended.”
Draghi said that the ECB will be “particularly vigilant” on the effects of oil prices, whose recent declines could not be factored in to the forecasts released today. The Bank of England also left rates unchanged on historic lows. In the U.S., fewer Americans filed jobless claims as employers retained staff to meet domestic demand ahead of the holiday season. A positive indicator for today’s labor market statistics. The US dollar rose against the yen to 120 for the first time since July 2007.
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