European stocks traded up positive on Friday in the wake of heavy losses on Thursday following the European Central Bank’s monetary policy announcements, which appeared particularly worried about the outlook for inflation due to developments in Ukraine.
The ECB lowered its growth forecasts and revised its inflation forecasts upwards, warning that prices could exceed 7% in 2022 in the worst-case scenario. In this context, the central bank is launching the closing of the bond purchasing program (APP) in the third quarter, although it left a window open for the continuation of purchases in the program if necessary.
At the same time as the ECB announcements, the data that saw the light of day in the US showed a new jump in inflation to 7.9% in February. This is the highest level since January 1982.
The Russian invasion of Ukraine and the barrage of Western sanctions against Moscow have intensified upward pressure on energy, food and minerals, which is expected to lead to a new jump in inflation in the coming months. This has rekindled concerns that central banks could tighten monetary policy faster than expected, slowing growth.
On the board, the pan-European Stoxx 600 index rose 0.5% to 429.42 points.
The German DAX gained 0.7% to 13,533.73 points, the French CAC 40 rose 0.3% to 6,223.72 points, while the British FTSE 100 strengthened 0.8% to 7,152.28 points.
In the region, the Italian FTSE MIB strengthened 0.8%, while the Spanish IBEX 35 rose 0.9%.
Source: Capital
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