European Shares Hold Steady At Midday Ahead Of ECB Meeting

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The ECB is expected to wind down its 2.55 trillion euro (2.22 trillion pounds) bond-buying programme by the end of this year and raise its policy rate for the first time since 2011 towards the middle of next year.

At a press conference, ECB President Mario Draghi admitted some moderation of the Eurozone economy. It is up around 1.5 percent against the USA dollar so far this year and was trading at $1.2155 shortly after 1 p.m. London time.

Asia also rose overnight as record quarterly profits from Samsung helped offset nerves in China after reports that US prosecutors have been investigating whether Chinese tech giant Huawei violated Iran sanctions.

The U.S. Dow Jones bluechip index had snapped a five-day losing streak on Wednesday, thanks to strong corporate earnings.

Commenting on the European Central Bank announcement, Nancy Curtin, chief investment officer at Close Brothers Asset Management, said: "Europe remains firmly in a period of growth, but lately we've seen momentum slow significantly".

"The worry is about an overheating, leading to a rise in inflation, higher interest rates which bring on a textbook recession".

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"The Governing Council confirms that the net asset purchases, at the current monthly pace of 30 billion euros, are meant to run until the end of September 2018, or beyond, if necessary", the ECB's policy statement said.

Euro zone bond yields, swept up in the Treasury market momentum, inched down from multi-week highs before the meeting, and the euro firmed off eight-week lows against the dollar.

Analyst Teppei Ino said the currency might soon test some key technical levels close to 110, and one level is 109.65, which is a 50 percent retracement of its November to March fall, while the other is its 200-day moving average near 110.27.

Claus Vistesen of Pantheon Macroeconomics said Draghi's statement about a focus on recent data "could be interpreted as a sign that the central bank is making the incoming [three months to June] data conditional on how it intends to proceed with QE".

Sweden's central bank remained dovish at a policy meeting, pushing the crown to its lowest versus the euro since late-2009.

Innes added that with equity market sentiment holding steady despite growing bond yields, the dollar could move through G-10 currency markets like a wrecking ball. The yield on 10-year German government bonds slid to 0.59%.

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