ECB Rate Decision Today; Powell and Macklem Say It Is Still Too Early to Cut Interest Rates

stiffness from the ECB and the Bank of Canada Wednesday, as Federal Reserve Chair Jerome Powell testified before Congress and the central banks issued decisions on interest rates. At the Bank of Canada, Governor Tiff Macklem said it was too early to consider lowering the policy rate, as the central bank wants to push inflation lower. The target for the overnight rate was at an appropriate level, Macklem said. In the U.S., Powell told the House Financial Services Committee that the Fed isn't rushing to cut rates, and needs more evidence that inflation is slowing. He said: "We're not looking for better inflation readings than we've had. We're just looking for more of them." In other news:

• The OECD says government borrowing will hit a record high this year, with interest costs rising as bonds issued before the inflation surge mature.
• Chinese officials disclose a double-digit percentage jump in exports in the first two months of the year, but say more stimulus is likely required.
• U.K. Treasury Chief Jeremy Hunt announces income-tax cuts in an effort to boost a stagnant economy, but the budget watchdog forecasts weak growth.

Forward Guidance

Thursday:

• The ECB issues an interest rate decision at 8:15 a.m.
• Fed Chair Powell testifies before the Senate Banking Committee at 10 a.m.
• Cleveland Fed President Loretta Mester speaks at 11:30 a.m.
• U.S. consumer credit is reported at 3 p.m.
• The Fed's balance sheet is updated at 4:30 p.m.
• New York Fed's Williams speaks in discussion at the London School of Economics at 7 a.m.
• The U.S. employment report for February is released at 8:30 a.m.