Global stock indexes rallied to record highs on Thursday, while government bond yields fell after the European Central Bank held interest rates steady and Federal Reserve Chair Jerome Powell reiterated that easing was likely in 2024 if inflation behaved.
The yield on benchmark 10-year US Treasury notes hit a near one-month low then steadied as investors adjusted positions before Friday’s release of the February U.S. payrolls report.
That is a highly anticipated monthly U.S. economic release because of its centrality to the Fed’s high employment and low inflation mandates.
While the ECB left its policy rate at a record high, it took a first, small step towards lowering it, saying inflation was easing faster than it anticipated only a few months ago.
“We are making good progress towards our inflation target and we are more confident as a result – but we are not sufficiently confident,” ECB President Christine Lagarde told a press conference. That sent the pan-European STOXX 600 to a record high. It closed up 0.99%, while Europe’s broad FTSEurofirst 300 index rose 20.37 points, or 1.03% In the U.S., Powell on Wednesday testified before the House Financial Services Committee, saying rate reductions would “likely be appropriate” this year “if the economy evolves broadly as expected” and once officials gained more confidence in inflation’s steady decline. He repeated those comments before the Senate Banking Committee on March 7.
US stock market: Shares rally to records ahead of jobs report
