Thursday preview: No action expected on ECB policy

The European Central Bank on Thursday is widely expected to keep policy measures unchanged.

Analysts see the ECB maintaining interest rates at 0.05%, the deposit facility rate at -0.30% and the marginal lending facility rate at 0.30%. The asset purchase programme is also expected to continue at €60bn a month until March 2017.

Last month the ECB extended the asset purchase programme past September 2016 and cut the deposit rate 10 basis points.

While no action is expected this month, President Mario Draghi's press conference held shortly after the policy announcement will be watched closely for any clues on the ECB's plans going forward.

The ECB has been under mounting pressure to address low inflation, risks stemming from weakness in emerging markets, geopolitical tensions and slowing demand for Eurozone exports.

A final estimate from Eurostat on Tuesday showed the Eurozone consumer price index rose 0.2% in December, as expected by analysts. November was revised down to 0.1% from a previous estimate of 0.2%.

The ECB is targeting inflation of just below 2%

“Although we expect the ECB to deliver further policy accommodation amid low inflation, we believe Thursday’s meeting is too soon for action given the proximity of December’s announcement of further policy easing,” said BNP Paribas senior European economist, Gizem Kara.

Kara added that the fall in core inflation from 1.1% year-on-year in October to 0.9% in December should “tone down hopes of some ECB Governing Council members that core inflation is gently trending up”.

“Any rhetoric on this at the ECB press conference on Thursday will be key to watch.”

Thursday 21 January

INTERIMS
NCC Group

INTERIM DIVIDEND PAYMENT DATE
Home Retail Group

INTERIM EX-DIVIDEND DATE
Alcentra Euorpean Floating Rate Income Fund Ltd Red Ord Shs, Coral Products, Ediston Property Investment Company, Fletcher King, GCP Infrastructure Investments Ltd, SSE, Supergroup

QUARTERLY EX-DIVIDEND DATE
GCP Infrastructure Investments Ltd, Twentyfour Income Fund Limited Ord Red

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Price Index (EU) (10:00)
Continuing Claims (US) (13:30)
ECB Interest Rate (EU) (12:45)
Harmonised Index of Consumer Prices (EU) (10:00)
Initial Jobless Claims (US) (13:30)

GMS
Fusionex International, Styles & Wood Group

FINALS
Fusionex International, Safestore Holdings

IMSS
Land Securities Group

SPECIAL EX-DIVIDEND PAYMENT DATE
Dewhurst, Dewhurst (Non-Voting)

AGMS
Cardiff Property, easyHotel, Keystone Inv Trust, Stride Gaming

TRADING ANNOUNCEMENTS
British Land Company, Halfords Group, Laird, Royal Mail, SABMiller, St James's Place

UK ECONOMIC ANNOUNCEMENTS
RICS Housing Market Survey (09:30)

FINAL DIVIDEND PAYMENT DATE
Cambria Automobiles

FINAL EX-DIVIDEND DATE
Compass Group, Dewhurst, Dewhurst (Non-Voting), Electra Private Equity, Henderson Alternative Strategies Trust , Shaftesbury