Europe’s twin woes of too little inflation and too many unemployed will dominate data due this week just as officials prepare forecasts backing the rationale for Mario Draghi’s surprise interest-rate cut.
The European Central Bank’s probe into the health of Europe’s banks will be more credible than previous exercises because the institution itself will have to deal with the outcome, the official overseeing the test said.
The European Central Bank will require the euro area’s biggest banks to hold a capital buffer of at least 8 percent as it takes charge of financial supervision in the currency bloc, three people familiar with the situation said.
The European Central Bank’s plan to step up dollar lending to the region’s banks is only a temporary solution to easing funding needs and solving the region’s debt crisis, said Marco Valli, chief euro-area economist at UniCredit Group in Milan.
Euro-area jobless data this week will expose the social cost of last year’s debt crisis and recession on southern European economies as unemployment across the region probably rose to a record in December.