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Zelensky and Trump loom over DavosTwo people are having an outsize impact at the World Economic Forum, and one of them isn’t even there. One is Volodymyr Zelensky, Ukraine’s president, who put on a full-court press of business and global leaders at the forum in Davos, Switzerland. Zelensky isn’t the only leader at Davos worried about Trump. The Ukrainian leader has sought to shore up global business support. And the annual wine tasting hosted by Anthony Scaramucci, the financier and former Trump official, well, ran out of wine.

Persons: Volodymyr Zelensky, Donald Trump, Zelensky, Vladimir Putin, Andrew, Trump, Putin, “, ” Zelensky, Republican Party ”, DealBook, thumped, JPMorgan Chase, Steve Schwarzman, Blackstone, Ray Dalio, David Rubenstein, Carlyle, Michael Dell, John Kerry, Biden’s, Anthony Scaramucci, Christine Lagarde, Christopher Waller, Nelson Peltz’s, James Gorman, Morgan Stanley, Mary Barra, General Motors —, Bob Iger, Disney’s, Murray Auchincloss, Bernard Looney, Auchincloss, Yi Fuxian Organizations: Trump, Economic, Ukraine, Republican Party, Republican, JPMorgan, Congress Center, Dell, European Central Bank, Fed, Disney, General, BP, University of Wisconsin – Locations: Davos, Switzerland, Europe, Ukraine, American, Iowa, Bridgewater, China, Beijing, Russia, Britain, U.S, Asia, University of Wisconsin – Madison

☆ UK inflation posts first rise in almost a year
▼ + stars: | 2024-01-17 | by ( Hanna Ziady | ) edition.cnn.com time to read: +2 min

London CNN —UK inflation accelerated in December for the first time since February last year, official data showed Wednesday. Core inflation, which strips out volatile food and energy prices, remained stuck at 5.1%, while services inflation increased from 6.3% to 6.4%. The UK data mirrors the trend in the United States and Europe of slight upticks in headline inflation. Energy prices could also rise if the conflict in the Middle East escalates further. Still, several leading UK economists shrugged off the latest increase in inflation, noting that inflation could return to the Bank of England’s 2% target by the spring, helped by recent falls in energy prices.

Persons: Grant Fitzner, shrugged, ”, Roger Barker, Yael Selfin Organizations: London CNN —, National Statistics, Reuters, US Federal Reserve, European Central Bank, Bank of England’s, Institute of, KPMG, Bank of England Locations: United States, Europe, Red

☆ Markets getting ahead of themselves on rate cuts and risk being 'self-defeating,' ECB member says
▼ + stars: | 2024-01-17 | by ( Jenni Reid | ) www.cnbc.com time to read: +1 min

Markets are "getting ahead of themselves" with rate cut expectations, the president of the Dutch central bank, Klaas Knot, told CNBC Wednesday. But a lot needs to go well for that to happen," European Central Bank member Knot said, speaking at the World Economic Forum in Davos. "Underlying that projection is an interest rate path, assumed interest rate path, that contains significantly less easing than is currently embedded in market pricing. ECB officials have largely pushed back on market expectations for interest rate cuts starting as soon as the spring. Austrian central bank head Robert Holzmann, an ECB arch-hawk, told CNBC on Monday that there were threats to the inflationary picture that could mean rates do not move lower at all this year.

Persons: Klaas Knot, Knot, Robert Holzmann Organizations: CNBC, Central Bank, Economic, ECB Locations: Dutch, Davos, Austrian

☆ Stock Market Today: Dow Slips 350 Points; Bank Earnings in Focus
▼ + stars: | 2024-01-16 | by ( ) www.wsj.com time to read: +1 min

Stocks turned lower Tuesday after a Federal Reserve official said the central bank could cut interest rates this year but that the process should be "carefully calibrated and not rushed." In Europe, pushback on imminent rate cuts from European Central Bank officials and news that the German economy shrank last year weighed on markets. An index of bank shares fell. Shares of leading U.S.-listed Chinese companies fell, with the Invesco Golden Dragon China exchange-traded fund down 3%. EV company Nio's ADRs were down 8%; Baidu, the owner of China’s largest internet search engine, and e-commerce giant JD.com slid about 4%.

Persons: Stocks, Dow industrials, Morgan Stanley, Goldman Sachs, Tesla, Elon Musk, Yemen's Houthi, Nio's ADRs Organizations: Federal Reserve, European Central Bank, PNC, Boeing, Shell, Benchmark, EV, Nio's, Baidu Locations: Europe, China

☆ Gold frail as dollar, yields strength dim shine
▼ + stars: | 2024-01-16 | by ( ) www.cnbc.com time to read: +2 min

An employee handles one kilogram gold bullion at the YLG Bullion International Co. headquarters in Bangkok, Thailand, on Friday, Dec. 22, 2023. Gold prices were subdued on Tuesday as the dollar and Treasury yields rose, while traders waited to hear from a slew of U.S. Federal Reserve speakers this week for more clarity on the central bank's rate cut prospects. The dollar index touched a 10-day high, making bullion less attractive for other currency holders, while yields on benchmark U.S. 10-year Treasury notes rose above 4%. Elsewhere, European Central Bank officials pushed back against market expectations for rapid rate cuts this year. According to Reuters technical analyst Wang Tao, spot gold may retrace to $2,042 per ounce, after its repeated failures to break resistance at $2,060.

Persons: Christopher Waller's, Matt Simpson, Christopher Waller, Waller, Simpson, Wang Tao Organizations: Co, . Federal Reserve, Index, Fed, Brookings Institution, Traders, Central Bank Locations: Bangkok, Thailand

☆ CNBC Daily Open: Down to Davos
▼ + stars: | 2024-01-16 | by ( Shreyashi Sanyal | ) www.cnbc.com time to read: +2 min

This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Asia markets fell, led lower by declines in Hong Kong stocks, as Japan shares cooled off from their record-breaking rally. Georgieva told CNBC on the sidelines of Davos that the world's second-largest economy is facing both short-term and long-term challenges. [PRO] Morgan Stanley picks 'alpha' stocksAlpha stocks are those that can beat the benchmark index, and Morgan Stanley picked its favorite plays in Asia.

Persons: Martin Luther King Day, Goldman Sachs, Morgan Stanley, Robert Holzmann, it's, Mario Centeno, Georgieva Organizations: CNBC, ECB, European Central Bank, Economic, International Monetary Fund, Alpha Locations: Asia, Hong Kong, Japan, Davos, Switzerland, China, Pacific

☆ Trump’s landslide Iowa win is a stunning show of strength after leaving Washington in disgrace
▼ + stars: | 2024-01-16 | by ( Stephen Collinson | ) edition.cnn.com time to read: +12 min

CNN —Former President Donald Trump’s huge win in the Iowa caucuses on Monday enshrines one of the most astonishing comebacks in American political history. His MAGA-hat wearing crowd greeted him with chants of “Trump, Trump, Trump” beneath two vast screens reading “Trump wins Iowa!”But the ex-president’s rebound is more stunning for another reason. Trump’s Iowa victory also sharpens the collision between the 2024 election and his legal imbroglio. His unhinged behavior, incessant shattering of rules and challenges to the law reinvigorated a brand perfectly tailored to Republican voters who despise “elites” in politics, government and the media. Trump’s victory will also give Russian President Vladimir Putin another reason to prolong the bloody war in Ukraine.

Persons: Donald Trump’s, Trump, ” Trump, MAGA, “ Trump, “, he’s, Joe Biden’s, ”, Ron DeSantis, Nikki Haley, Haley, DeSantis, it’s, Biden, Kari Lake, “ It’s, Donald Trump, Scott Jennings, —, E, Jean Carroll, don’t, GOP —, CNN’s Manu Raju, Tim Scott, Sen, John McCain, Jimmy Carter, Doug Burgum, Trump’s, America’s, Christine Lagarde, Vladimir Putin, he’d, Putin, Volodymyr Zelensky Organizations: CNN, GOP, Trump, “ Trump, Iowa, Capitol, Republican, Florida Gov, South Carolina Gov, Senate, Republican Party, Republican National Committee, North Dakota Gov, White, European Central Bank, NATO Locations: Iowa, Manhattan, week’s, Hampshire, Arizona, ” Iowa, Trump’s Iowa, Carolina, Des Moines, France, Europe, Ukraine

☆ As others try to quash rate cut talk, European Central Bank's Centeno flags inflation progress
▼ + stars: | 2024-01-16 | by ( Jenni Reid | ) www.cnbc.com time to read: +2 min

Euro zone inflation is moving in the right direction, Portugal's central bank governor Mario Centeno said Tuesday, despite his peers on the European Central Bank Governing Council striking a more hawkish tone in recent days. "We target medium term inflation, we don't target February inflation, and the trajectory is very positive right now," Centeno told CNBC at the World Economic Forum in Davos, Switzerland. "I don't say that overshooting is a possibility, but we don't need to do more than is needed to bring inflation in the medium term to 2%. Since the end of 2022, all our forecasts to 2025 show a very well-anchored forecast for inflation in the medium term." Services inflation is falling faster than it went up and is on a particularly positive course, according to Centeno.

Persons: Mario Centeno, Centeno, Robert Holzmann, Holzmann, We've Organizations: European Central Bank Governing Council, CNBC, Economic, ECB Locations: Davos, Switzerland, Austrian

☆ Dollar advances as traders weigh rate cut expectations, eyes on data
▼ + stars: | 2024-01-16 | by ( ) www.cnbc.com time to read: +4 min

Traders are back projecting cuts of 160 bps this year, up from expectations of 140 bps last week. Chris Weston, head of research at Pepperstone, said the risk is that Waller could push back on market pricing for a March cut and show a lack of urgency to normalize policy. "That said, should he even remotely validate market pricing, then we should see U.S. 2-year bond yields fall further. Markets are pricing around 120 bps of rate cuts by the Bank of England in 2024, with the first one most likely in May. Elsewhere, the Australian dollar fell 0.43% to $0.6632, while the New Zealand dollar fell 0.39% to $0.6176.

Persons: Hamish Pepper, Christopher Waller, Waller, Chris Weston, Weston, Bank's Joachim Nagel Organizations: U.S, Federal, Bank of Japan, Fed, Traders, Asset Management, Treasury, Bank of England, New Zealand Locations: Tokyo, Japan, U.S

☆ CNBC Daily Open: A look across the Atlantic
▼ + stars: | 2024-01-16 | by ( Shreyashi Sanyal | ) www.cnbc.com time to read: +2 min

This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. ECB could defy marketsEuropean Central Bank policymaker and hawk Robert Holzmann said the ECB may not deliver any interest rate cuts this year. Holzmann told CNBC at the World Economic Forum in Davos, Switzerland, that he sees a possibility of zero rate cuts this year, defying market expectations. Georgieva told CNBC on the sidelines of Davos that the world's second-largest economy is facing both short-term and long-term challenges.

Persons: Martin Luther King, Robert Holzmann, Holzmann, Georgieva Organizations: CNBC, Economic, Martin Luther King Day, Central Bank, ECB, International Monetary Fund, Federal Reserve Locations: Davos, Switzerland, Germany, China

☆ Davos live updates: Global leaders discuss the impact of high interest rates and the new normal
▼ + stars: | 2024-01-16 | by ( Lucy Handley | ) www.cnbc.com time to read: 1 min

French central bank chief François Villeroy de Galhau stressed that it was not possible to say in which season the European Central Bank may cut interest rates this year. But...we are not calendar driven, we are data-driven," he said during a CNBC-moderated panel event at the World Economic Forum in Davos, Switzerland. On the path of inflation, he added: "It's too early to declare victory … the job is not yet done. That said, interest rate tightening has been quite successful so far, more successful than we thought even at Davos one year ago." "What we can see on both sides of the Atlantic is something like a soft landing so far."

Persons: François Villeroy, Galhau, — Jenni Reid Organizations: European Central Bank, CNBC, Economic Locations: Davos, Switzerland

☆ Possible there will be no rate cuts this year, European Central Bank member says
▼ + stars: | 2024-01-15 | by ( Jenni Reid | ) www.cnbc.com time to read: +1 min

The European Central Bank may defy market expectations and hold off on starting interest rate cuts during the whole of 2024, the institution's Governing Council member Robert Holzmann said Monday. Asked about those who call for the first rate cut to take place as soon as April, Austria's central bank governor told CNBC, "I'm afraid, leaving Davos, those people will be deeply disappointed." Speaking to CNBC's Steve Sedgwick at the World Economic Forum in Davos, Switzerland, he added, "I cannot imagine that we'll talk about cuts yet, because we should not talk about it. "Unless we see a clear decline towards 2%, we won't be able to make any announcement at all when we're going to cut," Holzmann said. Correction: This story has been updated to reflect the name of CNBC anchor Steve Sedgwick.

Persons: Robert Holzmann, Steve Sedgwick, Holzmann, Yemen's Organizations: European Central Bank, CNBC, Economic, InTouch Capital Locations: Austria's, Davos, Switzerland, Israel

FRANKFURT, Germany (AP) — Germany's economy shrank 0.3% last year as Europe's former powerhouse struggled with more expensive energy, higher interest rates, lack of skilled labor and a homegrown budget crisis. Europe's largest economy has been mired in stagnation since the last months of 2022 amid those multiple challenges. The International Monetary Fund expected Germany to be the worst-performing major developed economy last year, a major turnaround from its place as a model for how to expand when other nations were struggling. German's economy likely also shrank 0.3% in the fourth quarter after stagnating in the third quarter, the Federal Statistical Office said Monday in an initial rough estimate. Official figures for the last three months of 2023 are expected to be announced Jan. 30.

Persons: there's Organizations: Monetary Fund, Federal Statistical Office, Energy, European Central Bank Locations: FRANKFURT, Germany, Ukraine

☆ ECB hawk Holzmann sees possibility of no rate cuts this year
▼ + stars: | 2024-01-15 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailECB hawk Holzmann sees possibility of no rate cuts this yearAustrian central bank governor, Robert Holzmann, discusses the interest rate outlook, risks to the European Central Bank's inflation forecast, and why he would "definitely bet" on no rate cut in the spring.

Persons: Robert Holzmann Organizations: ECB Locations: Austrian

☆ Europe wants to Trump-proof in case of a second term. But that is not an easy task
▼ + stars: | 2024-01-14 | by ( Luke Mcgee | ) edition.cnn.com time to read: +8 min

CNN —Former US President Donald Trump briefly returned as a central character in European politics earlier this week. Multiple EU officials and diplomats noted to CNN that his sudden recollection came at a particularly sensitive time, as the EU attempts to build its own defense capabilities outside of the US-led NATO alliance. Whether Trump actually made these comments or not is largely immaterial to European officials. And his hostility toward the Ukraine war effort has an impact even now, playing into the Republican Party’s reluctance to pass more US funding for Ukraine. Christine Lagarde, head of the European Central Bank, said only this week that Trump’s return would be a “threat” for Europe.

Persons: Donald Trump, Thierry Breton, Trump, Ursula von der Leyen, ” Breton’s, Russia’s Vladimir Putin, Letitia James, Spencer Platt, ”, Joe Biden, Europe’s, Ian Bond, ” Donald Trump, Jim Watson, Angela Merkel, Jesco Denzel, there’s, Christine Lagarde Organizations: CNN, Former, European, Republican, NATO, New York, Getty, Ukraine, “, Trump, EU, Centre, Economic, European Central Bank Locations: Europe, Iowa, Ukraine, New York City, Brussels, EU, United States, America, China, Davos, AFP, Russia, Beijing, Moscow, Charlevoix , Canada, European

☆ These European stocks are likely to outperform once rate cuts begin, BofA says
▼ + stars: | 2024-01-12 | by ( Weizhen Tan | ) www.cnbc.com time to read: +1 min

Investors are eagerly looking forward to rate cuts this year — the U.S. Federal Reserve signaled at least three, which would end an aggressive interest rate-hiking campaign for the last couple of years. The question is when the first of the rate cuts will come. Investors should, however, take note that the Fed also indicated an "unusually elevated degree of uncertainty" about the policy direction. Still, against that backdrop of expected cuts, BofA created a screen of which global companies might outperform as rates fall, and have "not yet rallied as strongly" as the average historical performance following the initial cut of the cycles. BofA screened for companies under scenarios such as whether the Fed cuts at a faster or slower pace than the European Central Bank — and vice versa.

Persons: BofA, — CNBC's Michael Bloom Organizations: U.S . Federal, Federal, Market, European Central Bank — Locations: U.S, Europe

☆ Oil prices fall 1% after surprise US storage build
▼ + stars: | 2024-01-10 | by ( ) www.cnbc.com time to read: +2 min

Oil prices fell nearly a dollar a barrel on Wednesday after a surprise jump in U.S. crude stockpiles raised worries about demand in the largest oil market. Global benchmark Brent crude oil futures settled 79 cents, or 1%, to $76.80 a barrel. Early in the session, both contracts had risen by more than a dollar before the U.S. Energy Information Administration reported a surprise build in crude oil stockpiles and larger-than-expected jumps in storage of gasoline and distillates. Gasoline stocks rose by 8 million barrels while distillate stocks jumped by 6.5 million barrels, the EIA reported. Europe's weak economic outlook also added to oil demand concerns.

Persons: Rob Haworth, Haworth, Luis de Guindos, majeure Organizations: U.S . West Texas, Brent, U.S . Energy Information Administration, U.S, Bank Asset Management, EIA, European Central Bank, National Oil Corporation Locations: Nolan , Texas, U.S, Israel

☆ Oil prices rise on Middle East tensions
▼ + stars: | 2024-01-05 | by ( ) www.cnbc.com time to read: +2 min

Oil prices gained on Friday, as U.S. Secretary of State Antony Blinken prepared to visit the Middle East to try and prevent the Israel-Gaza conflict from widening. The price rebound serves as "a reminder of the risk that is rooted in ever-growing tension in the Middle East," PVM analyst Tamas Varga said in a note. As the threat of the conflict expanding persists, Blinken was set to travel to the Middle East for a week of diplomacy, the State Department said. "There is still plenty of tension in the Middle East with Houthi rebels launching a sea drone in the Red Sea, a U.S. airstrike in Baghdad," ING analysts said in a report on Friday. Euro zone inflation rose in December and could continue rising in early 2024, which would ease pressure on the European Central Bank to start cutting rates.

Persons: pumpjack, Antony Blinken, Tamas Varga, Blinken, Investors Organizations: Brent, U.S, West Texas, State Department, ING, European Central Bank, Federal Locations: Bakersfield, Kern County , California, USA, Israel, Gaza, Red, U.S, Baghdad

☆ Euro zone inflation rebounds in December, fueling rate-cut debates
▼ + stars: | 2024-01-05 | by ( Jenni Reid | ) www.cnbc.com time to read: +1 min

Headline inflation in the euro zone jumped to 2.9% in December, up from 2.4% the previous month, though core inflation continued to ease, according to data released Friday by Eurostat. Core inflation — which doesn't include energy, food, alcohol and tobacco prices — cooled to 3.4% last month from 3.6% in November. An overall rise was expected due to base effects from the energy market, as price falls moderate. Energy prices were down 6.7% year on year in December, versus a 11.5% drop in November. The headline inflation rise "is essentially a technicality," Michael Field, European market strategist at Morningstar, said in a note.

Persons: Michael Field Organizations: Eurostat, Energy, European, Morningstar

☆ European Central Bank holds rates and trims its inflation forecast
▼ + stars: | 2023-12-14 | by ( Jenni Reid | ) www.cnbc.com time to read: +3 min

BRUSSELS, BELGIUM - NOVEMBER 27: Christine Lagarde, President of the European Central Bank speaks during the European Parliament's Committee on Economic and Monetary Affairs (ECON) meeting in Brussels, Belgium on Nevember 27, 2023. (Photo by Dursun Aydemir/Anadolu via Getty Images)The European Central Bank on Thursday held interest rates steady for the second meeting in a row, as it revised its growth forecasts lower and announced plans to speed up the shrinking of its balance sheet. The latest staff macroeconomic projections see average real GDP expanding 0.6% in 2023, from a prior forecast of 0.7%. Headline inflation is meanwhile seen averaging 5.4% in 2023, 2.7% in 2024 and 2.1% in 2025. Members see core inflation, excluding energy and food, averaging 5% this year and 2.7% in 2024, 2.3% in 2025, and 2.1% in 2026.

Persons: Christine Lagarde, Dursun Aydemir, James Smith, CNBC's Joumanna Bercetche Organizations: European Central Bank, European Parliament's, Economic, Monetary Affairs, Getty, ECB, ING Locations: BRUSSELS, BELGIUM, Brussels, Belgium, Anadolu

☆ European Central Bank to focus on shrinking balance sheet as markets bet on rate cuts
▼ + stars: | 2023-12-13 | by ( Annette Weisbach | ) www.cnbc.com time to read: +2 min

Christine Lagarde, president of the European Central Bank (ECB). Bloomberg | Bloomberg | Getty ImagesFRANKFURT — The European Central Bank meets this week with investors closely monitoring to see when the Frankfurt institution might start to cut interest rates. "Nonetheless, markets will probably have to correct some of their overoptimistic rate cut expectations once the ECB has spoken this Thursday." watch nowMoney markets are currently pricing in almost 150 basis points of rate cuts next year. The PEPP, or the Pandemic Emergency Purchase Program, is a flexible bond purchase program introduced during the coronavirus pandemic.

Persons: Christine Lagarde, Holger Schmieding, Isabel Schnabel, Mark Wall Organizations: European Central Bank, Bloomberg, Getty, FRANKFURT, ECB, Reuters, Deutsche Bank Locations: Frankfurt, Berenberg

☆ Dollar steady as traders weigh labour data, rate outlook
▼ + stars: | 2023-12-06 | by ( ) www.cnbc.com time to read: +3 min

The dollar index , which measures the U.S. currency against six rivals, was 0.019% higher at 103.99, having climbed 0.3% overnight. Data also showed there were 1.34 vacancies for every unemployed person in October, the lowest since August 2021. "This week the highlight is payrolls (report)," OCBC currency strategist Christopher Wong said, adding that a downside surprise could see dollar rebound stall. Investors believe the European Central Bank could deliver its first rate cut by March. Inflation across the euro zone has fallen more quickly than most anticipated, as evidenced by last Thursday's consumer price data.

Persons: Christopher Wong, Jerome Powell, Sterling, bitcoin, — Organizations: Reserve, Traders, ANZ, Fed, Investors, European Central Bank Locations: U.S

☆ Central bank blunders undermine tough rate talk
▼ + stars: | 2023-12-05 | by ( Francesco Guerrera | ) www.reuters.com time to read: +8 min

Comments by central bankers underline their desire to keep interest rates high until price growth quiesces. Policymakers’ recent mistakes mean they will struggle to convince investors their tough talk is real. U.S. Federal Reserve Chair Jay Powell says his fellow policymakers are “not thinking about rate cuts at all”. In May, after another U.S. regional bank failure, markets concluded that the Fed’s rate hike at the beginning of that month would be its last. Respected central bankers might be able to convince markets that these numbers don’t portend imminent rate cuts.

Persons: Jay Powell, Christine Lagarde, Andrew Bailey, Powell, backtrack, –, Lagarde, Treasuries, BoE, Bailey, Ben Bernanke, Jacob Frenkel, Peter Thal Larsen, Oliver Taslic, Thomas Shum Organizations: Reuters, Traders, U.S . Federal, European Central Bank, Bank of England, titans, Deutsche Bank, Treasury, Reuters Graphics Reuters, LSEG, Silicon Valley Bank, Fed, ECB, Bank of Israel, Federal Reserve, European, Thomson Locations: Silicon, Bailey, United States, Ukraine, Central

☆ Morning Bid: Small caps pick up baton, China rating hit
▼ + stars: | 2023-12-05 | by ( ) www.reuters.com time to read: +6 min

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 26, 2023. The likes of Microsoft (MSFT.O), Apple (AAPL.O), Nvidia (NVDA.O) and Amazon (AMZN.O) fell back over 1%, pressured by a modest bounceback in U.S. Treasury yields. China's blue-chip stocks slumped to their lowest since February 2019 amid fears of a possible cut to China's sovereign credit rating cut after Moody's outlook reduction. By Mike Dolan, Editing by Bernadette Baum; <a href="mailto:mike.dolan@thomsonreuters.com" target="_blank">mike.dolan@thomsonreuters.com</a>Our Standards: The Thomson Reuters Trust Principles. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

Persons: Brendan McDermid, Mike Dolan, Russell, that's, Moody's, Isabel Schnabel, Michael Gibson, Christine Laggard, Mongo, Zero Fox, Bernadette Baum Organizations: New York Stock Exchange, REUTERS, Reserve, Microsoft, Apple, Nvidia, Treasury, Reserve Bank of Australia, Central Bank, Reuters, ECB, Barclays, Qatar, P Global, Federal, Division, Supervision, Financial Innovation, Descartes Systems, Health, Powell Industries, Dave, Buster's Entertainment, Reuters Graphics, Thomson Locations: New York City, U.S, Global, York, Treasuries, Europe

☆ ECB's Schnabel defends smaller balance sheet as debate heats up
▼ + stars: | 2023-12-05 | by ( Balazs Koranyi | ) www.reuters.com time to read: +4 min

She said her "demand-driven" approach fitted the euro zone, whose 20 countries vary in economic strength and have separate banking systems. "A demand-driven system is well-suited for a heterogeneous currency union that may be prone to fragmentation," Schnabel said in an interview. "Such a system also likely limits the size of the central bank balance sheet." She conceded, however, that "it could make sense to have a mix of different tools", suggesting policymakers may be looking for a compromise in this complex yet crucial debate for the euro zone financial system. Loans to banks or a structural bond portfolio would come on top of this.

Persons: Isabel Schnabel, Ralph Orlowski, Schnabel, Philip Lane, Schnabel's counterargument, Francesco Canepa, Catherine Evans Organizations: Frankfurt, Banking Congress, Old Opera, REUTERS, European Central Bank, ECB, Reuters, Federal Reserve, Bank of England, Thomson Locations: Frankfurt, Germany, FRANKFURT

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