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What the Iran Strikes Could Mean for U.S. Inflation
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- U.S. and Israeli attacks against Iran caused oil prices to surge, threatening higher gasoline prices and overall inflation.
- Benchmark U.S. crude futures rose 6% Monday to $71 a barrel after the conflict began, and are up nearly 24% year-to-date.
- JPMorgan Chase CEO Jamie Dimon said the conflict won’t be a major inflationary hit if it isn’t prolonged.
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Eurozone Inflation Remains Below Target, But Risks Loom
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- Eurozone inflation unexpectedly rose to 1.9% in February from 1.7% in January, exceeding economists’ expectations.
- Higher energy prices, including Brent crude topping $80 a barrel, followed U.S. and Israeli attacks on Iran.
- The ECB kept its key rate unchanged at 2% in early February, forecasting 1.9% average inflation for this year.
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ECB Should Be Prepared to Move Rates Quickly in Either Direction, Austria’s Central Bank Governor Says
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- Austria’s central bank governor said the ECB should be ready to quickly adjust its key interest rate due to fresh uncertainty.
- The uncertainty stems from U.S. developments, including President Trump’s Greenland threat and new tariffs, plus U.S./Israel attacks on Iran.
- Martin Kocher said the ECB should respond to outcomes, not possibilities, and noted the euro appreciated over 13% against the U.S. dollar.
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Australia’s Economy on Track to Record Strong Growth
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- Australia’s economy is expected to report solid 2.5% annual GDP growth in Q4, increasing pressure on the RBA for another interest-rate rise.
- RBA Governor Michele Bullock said all policy meetings, including the March 16-17 one, are “live,” suggesting a shift in earlier cautious rhetoric.
- The RBA raised the official cash rate to 3.85% in February due to inflation being above its 2.5% target and continuing to drift upward.
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U.S. Factory Activity Continued to Expand in February
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- U.S. factory activity expanded for the second straight month in February, with the ISM index at 52.4, a survey said.
- New orders and production grew at a slower pace, while the backlog of orders reached its highest reading since May 2022.
- The prices index expanded to its highest reading since June 2022, potentially adding to Federal Reserve concerns.
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Canada Manufacturing Sector PMI Picks Up Again
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- Canadian manufacturers’ activity expanded for a second consecutive month in February, with the PMI rising to 51.
- New orders grew for the first time in 13 months due to improving domestic demand, offsetting declining export sales.
- U.S. tariffs continued to create headwinds for export sales, despite manufacturers’ highest optimism since December 2024.
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About Us
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WSJ Pro Central Banking brings you news and analysis from a global team of reporters and editors at The Wall Street Journal and Dow Jones Newswires. Send your tips, suggestions and feedback to service@dowjones.com. An artificial-intelligence tool created these summaries, which are based on the text of the article and checked by an editor. Read more about how we use artificial intelligence in our journalism.
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