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Print the banner, folks: deflation is officially no longer an issue for the eurozone!

Mario Draghi has declared victory against deflation and taken a step towards ending the European Central Bank’s ultra-loose monetary policy, sending the euro and German bond yields higher as investors bet on the end of crisis-era stimulus measures.

Though the ECB agreed to keep interest rates at record lows, Mr Draghi said the bank no longer had a “sense of urgency” to take further action on monetary stimulus and that policymakers “do not anticipate that it will be necessary to lower rates further”.

Markets will be looking forward to US jobs data due out on Friday, which, if solid, could bolster the already strong case for an interest rate rise.

In Asia Pacific equities, Sydney’s S&P/ASX 200 index is up 0.1 per cent in early trading, while futures tip Tokyo’s Topix to climb 0.5 per cent at the open and in Hong Kong the Hang Seng is expected to dip 0.2 per cent when trading starts.

Corporate earnings reports out today include China Resources Cement Holding, Delta Electronics, Wheelock, Guangzhou R&F Properties, Orient Overseas International, Japan Logistics Fund and China Goldjoy Group.

The economic calendar for Friday is on fleek (all times Hong Kong):

  • 08.30: Australia home loans (Jan)
  • 09.30: Philippines imports, exports and trade balance (Jan)
  • 11.30: Thailand consumer confidence
  • 12.30: Malaysia palm oil production
  • 13.00: India local car sales
  • 15.30: Thailand foreign exchange reserves
  • 20.00: India industrial output

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