European Central Bank leaves rates unchanged, drops easing bias

Eyeing the easy money exit: Five questions for the ECB

Premier Global Alpha Growth manager Jake Robbins described the removal of the reference to the bond-buying programme's possible extension as "slightly unexpected", although added protectionism still weighed on European Central Bank monetary policy.

"There is also a worry about the state of worldwide relations, because if you put tariffs against (those) who are your allies, one wonders who the enemies are", he added.

Wall Street opened higher just after Draghi spoke and the dollar was up marginally too. After a political deadlock in Italy and Trump's recent tariff proposals on aluminum and steel imports, the European Central Bank will probably hold a cautious tone. In another blow to Latvia's financial image, its No. 3 lender was closed last month amid US money-laundering claims.

"Import tariffs could be applied to nearly anything that a government believes will harm domestic producers, so this is likely to be the tip of the iceberg". This morning's Chinese trade data are only likely to reinforce the U.S. administration's perception of unfair trade as Chinese exports were seen to show a rise 44.5% in February, the best performance in over two years.

The U.S. Dollar rose against a basket of major currencies with the exception of the Canadian Dollar on Thursday.

This dampened hopes of a more hawkish stance from the bank in the coming months after it removed its mention of a pledge to extend its bond purchases in today's policy statement. U.S. gold futures were down 0.3 per cent at $1,318.1.

While the bloc's five-year growth run and a rapid drop in unemployment suggest that inflation will eventually rise, this rebound has taken many years more than expected and the rising euro could put a lid on price growth.

The ECB added that monthly net asset purchases of €30 billion were meant to run until the end of September, or beyond, if necessary.

The Euro is pushing higher against the Pound this afternoon following the ECB's latest policy meeting.

With the strong euro already exerting pressure on Europe's exporters, the last thing European Central Bank policymakers wanted to hear was President Trump planning to enact trade tariffs in the US.

That soothed worries about the prospect of more aggressive trade measures after the departure of Trump's top economic adviser Gary Cohn.

Masahiro Ichikawa at Sumitomo Mitsui Asset Management said the issue would hang over markets however.

On the Trump tariffs he said potential trade disputes "would introduce higher uncertainty in the future growth path". Rather than show that the global economy appears to be in fairly good health, they are likely to be used as further evidence by President Trump's trade hawks that his current policy is appropriate.

There was plenty to navigate in emerging markets, too.

The Mexican currency was at 18.72 pesos per dollar following its recovery from 18.90 touched on Wednesday.

The currency added 0.1 percent to 106.22 against the Japanese yen, while it climbed 0.2 percent to 0.9465 against the Swiss franc.

Pizza delivery firm Domino's Pizza rose 2.6 per cent following a better-than-expected 10.2 per cent rise in its full year pretax profit.

The dollar's recovery was stoked by Wednesday's data on USA private hiring and labor costs that reinforced the view of underlying strength in the economy.

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