The ECB is Taking Notes From The Fed

The ECB is Taking Notes From The Fed By Hardika Singh

Luis de Guindos, vice president of the European Central Bank, said the ECB is still on course for a June rate cut. Meanwhile, a $95 billion foreign aid proposal for Ukraine and Israel advanced through in the Senate. And the Chinese finance ministry said it wants the central bank to start trading Treasury bonds. Read on for this news and more.

Top News ECB Will Consider Fed's Progress When Deciding on Rate Cuts, De Guindos Says

The European Central Bank will take account of the Federal Reserve's progress in lowering inflation when it decides the pace of cuts to its key interest rate after a first move in June, its vice president said in an interview published Tuesday.

Grant's Take The Travel Bug Is Keeping the U.S. Economy Strong

The U.S. economy keeps humming along, and strong travel demand is a key reason why . First-quarter GDP will be revealed Thursday and economists expect that the U.S. grew at a 2.4% annual rate. That would once again defy predictions from economists and key Wall Street executives, who have forecast for years that economic growth would slow sharply or even turn negative.

U.S. Economy Senate Advances Ukraine, Israel Aid Closer to Finish Line

The Senate advanced a $95 billion foreign aid proposal that would send weapons to Ukrainian soldiers and fortify Israel's missile defense systems, setting up a final vote as soon as later Tuesday.

Financial Regulation China Finance Ministry Voices Support for Central Bank Bond Trading

China's finance ministry has said it is in favor of the central bank resuming trading Treasury bonds, a move that would see the monetary authority dust off a rarely used tool in its policy kit. Officials at the ministry said that they would support the People's Bank of China gradually restarting to trade Treasury bonds in open-market operations as they look to better coordinate the country's fiscal and monetary policies.

Forward Guidance Wednesday (all times ET)

8:30 a.m.: U.S. durable goods report for March, advance

1:30 p.m: Bank of Canada summary of monetary policy deliberations

Thursday

8:30 a.m.: U.S. weekly jobless claims

8:30 a.m.: U.S. GDP, advance estimate for first quarter

8:30 a.m.: Philadelphia Fed Non-Manufacturing Survey

10 a.m.: U.S. pending home sales index for March

Research Fitch Flags Canada's Elevated Debt Burden Among Governments

Fitch Ratings says Canada's annual budget plan, which envisages an expansion in budget deficits over the next five years, will have a minimal impact on the country's credit profile. Fitch is the lone major credit-rating firm that doesn't have a triple-A rating for Canada. Fitch said the Liberal government's spending plans make Canada's general government-debt burden-which incorporates federal and provincial outlays-one of the highest among its double-A rated sovereigns, at 104.1% of GDP. Fitch noted that's "considerably higher" than the medians for double-A and triple-A sovereigns, at 50.1% and 36.8% of GDP, respectively. - Paul Vieira

Basis Points HSBC is bullish on American equities markets in 2H after a bumpy start to the year, including a turbulent January and February that remain skewed by impacts of the pandemic. Jose Rasco, chief investment officer of global private banking and wealth management for HSBC Americas, says at a media roundtable that he believes policy rates and market rates in the U.S. have peaked. - Dean Seal A first cut in the Bank of England's key interest rate remains some way off, its chief economist said Tuesday. In a speech, Huw Pill said there had been little news on the U.K. economy since March, when he laid out his case for leaving the key rate at a 16-year high for the time being. - Paul Hannon A surprise rate increase by Indonesia's central bank underlines expectations that the start of monetary policy easing is looking increasingly far off for many Asian central banks , if it is on the horizon at all. - Fabiana Negrin Ochoa China's central bank has again reiterated its cautious approach to monetary easing , reinforcing views that it's unlikely to deliver a big liquidity boost via bond trading. Sentiment among German companies ticked higher for a third-straight month in April , despite only slow economic growth expected in the early part of this year, according to a closely watched survey. - Ed Frankl Australian consumer price inflation remained strong in the latest quarter , illustrating the challenge the country's central bank faces in bringing inflation back to target and adding uncertainty around the timing of interest-rate cuts. - David Winning About Us

WSJ Pro Central Banking brings you central banking news, analysis and insights from WSJ's global team of reporters and editors. This newsletter was compiled by markets reporter Hardika Singh in New York. Send your tips, suggestions and feedback to [hardika.singh@wsj.com].

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

04-24-24 0715ET