Will ECB cut rates again this week?

This week is an important one as there are some key central bank meetings scheduled. The markets will now shift their focus from the all-important US non-farm payrolls report and scrutinize policy decisions by the European Central Bank, Bank of Canada and Reserve Bank of New Zealand. In terms of economic data, Japanese GDP and Chinese inflation figures will attract attention as well.

The European Central Bank is widely expected to push its deposit rate deeper into negative territory when it meets next week. Expectations are for the ECB to cut the rate by 10 basis points to minus 0.4 per cent. The ECB is also expected to increase its bond-purchase program in order to stimulate growth and boost inflation.

From Japan we will get the final reading of GDP, which is forecast to show that the economy contracted 0.4 per cent sequentially in the final three months of the year. On an annualized basis growth may have slipped 1.6 per cent in the fourth quarter.

This week, investors also get the latest snapshot on the health of the world’s second largest economy, as China will publish the nation’s latest trade and inflation figures. Exports are expected to have contracted 15 per cent in February from the year ago period, while imports declined 10.2 per cent.

Chinese producer prices have remained in negative territory since March 2012 and are expected to have fallen 4.9 per cent last month on a year-on-year basis. Consumer prices are projected to

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