ECB and BoE maintain monetary policies, Fed likely to wind down bond buying

There was no change in monetary policy from the European Central Bank after its monetary policy meeting on Thursday. From Bloomberg:

European Central Bank President Mario Draghi signaled that deflation risks in the euro region are easing for now after new forecasts showed that inflation will approach their target by the end of 2016.

“The news that has come out since the last monetary policy meeting are by and large on the positive side,” he told reporters in Frankfurt today after the central bank kept its main interest rate at 0.25 percent. He also indicated that money markets are under control at the moment, lessening the need for emergency liquidity measures.

ECB optimism on the economy was supported by a report on Thursday that showed German factory orders rising 1.2 percent in January.

The Bank of England also left monetary policy unchanged after its meeting on Thursday.

There was also encouraging news from the US on Thursday, where initial claims for state unemployment benefits fell 26,000 to a three-month low of 323,000 last week.

However, another report on Thursday showed that new orders for manufactured goods in the US fell 0.7 percent in January.

Still, the Federal Reserve appears likely to proceed with its plan to wind down its bond purchases. From Reuters:

The U.S. economic outlook would have to change dramatically for the Federal Reserve to alter the pace at which it is winding down its massive bond-buying program, three top U.S. central bankers said on Thursday.

And one, Atlanta Fed President Dennis Lockhart, told Reuters in an interview that even a third month of below-par U.S. jobs growth would not be enough to warrant such a move.