Stock indices traded higher as commodity shares benefited from a weaker U.S. dollar. The greenback remained under pressure after yesterday's comments by New York Fed President William Dudley. He said in an interview with MNI that financial conditions were tighter than in December, and a stronger U.S. dollar could have "significant consequences" for the U.S. economy. He pointed out that the Fed would have to take that into consideration making its decision at its March monetary policy meeting.
The European Union (EU) Commission released it economic growth and inflation forecasts for the Eurozone on Thursday. Eurozone's economic growth for 2016 was cut to 1.7%, down from the previous estimate of 1.7%. Eurozone's economic growth for 2017 remained unchanged at 1.9%.
The EU Commission noted that there are risks to the outlook from the slowdown in emerging countries and possible further interest rate hikes in the U.S.
"Europe's moderate growth is facing increasing headwinds, from slower growth in emerging markets such as China, to weak global trade and geopolitical tensions in Europe's neighbourhood," EU Commission Vice President Valdis Dombrovskis said.
The EU commission lowered its 2016 inflation forecast for the Eurozone to 0.5% from 1.0%. Inflation is expected to be 1.5% in 2017.
According to the EU commission, inflation was driven by further drop in oil prices, but it was only temporary.
The Bank of England will release its interest rate decision at 12:00 GMT. Analysts expect the central bank to keep its monetary policy unchanged.
Halifax released its house prices data for the U.K. on Thursday. House prices in the U.K. jumped 1.7% in January, exceeding expectations for a 0.3% gain, after a 2.0% gain in December. December's figure was revised up from a 1.7% increase.
On a yearly basis, house prices climbed 9.7% in the three months to January, after a 9.5% increase in the three months to December.
"The imbalance between supply and demand continues to exert significant upward pressure on house prices. This situation looks set to persist over the coming months," Halifax's housing economist Martin Ellis said.
Name Price Change Change %
FTSE 100 5,914.74 77.60 1.33 %
DAX 9,471.95 37.13 0.39 %
CAC 40 4,237.07 10.11 0.24 %