European Markets Steady Ahead of ECB Meeting

By Josie Cox 

        European markets were steady in early trading Thursday, poised to react to the outcome of what many have described as a historicEuropean Central Bank monetary policy meeting that is expected to deliver a bond-buying program to rekindle the region's economy.
        "The most important day in ECB's history has arrived," economists at Citigroup wrote in a note, adding that "markets have high hopes that the governing council has managed to straighten all its arguments and diverging opinions under [President Mario] Draghi's savvy leadership."
        Markets anticipate the central bank will announce a broad-based asset purchasing program, and those expectations have in recent days driven stock indexes to multiyear highs, government bond yields to record lows and the euro to a more than 11-year low against the dollar.
        On Wednesday, those moves were generally accentuated, after people familiar with the matter said a proposal from the ECB's Frankfurt-based executive board is calling for bond purchases of roughly EUR50 billion ($58 billion) a month that would last for a minimum of one year.
        The Stoxx Europe 600 added 0.3% early Thursday, while Germany's DAX, France's CAC and London's FTSE 100 were broadly flat.
        The euro edged lower against the dollar, to a day's low of $1.1576, taking year-to-date losses against the buck to just over 5%.
        BNP Paribas currency strategists said that with expected volatility likely to persist throughout the meeting, any decision in line with reports would "be consistent with continued euro trend depreciation."
        The yield on the German 10-year government bond, which falls as bond prices rise, was steady at around 0.49%.
        Write to Josie Cox at josie.cox@wsj.com
        (END) Dow Jones Newswires

        January 22, 2015 03:37 ET (08:37 GMT)

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