Key highlights of the week ended April 1

Source: Dukascopy Bank SA
US
Fed Chair Janet Yellen insisted on a slower path and more cautious approach to interest rate hikes amid global economic and financial uncertainties, which pose risks to the world's number one economy. In her comments, Yellen said inflation has not yet proven durable against the backdrop of still low oil prices and concerns over China. However, Yellen expected headwinds from slowdown abroad, low oil prices and uncertainty over China to wane and allow the US economy to continue recovering and justify gradual series of rate hikes. Fed policy makers kept interest rates on hold at their March 15-16 meeting and sharply reduced their projected path of interest rate increases this year, foreseeing a total rise of half a percentage point, down from the full percentage point hike they expected in December.

Canada
Canada's economy surprised by a stellar performance in January, with gross domestic product increasing the most in two-and-a-half years, boosted by strong manufacturing, retail trade as well as oil and gas extraction. The Canadian economy expanded by a more-than-expected 0.6% in January from the month before, growing for the fourth consecutive month. The figure was twice as much as economists had projected. Goods-producing industries surged by 1.2%, according to Statistics Canada, far better than the 0.4% growth seen in the service sector.  Manufacturing grew 1.9% in January, up from a 1.1% increase in December. That indicates that the Canadian Dollar's decline is finally starting to help manufacturing exporters, as economists had predicted. Measured on an annual basis, the economy grew 1.5%, also coming in above earlier projections of 1%.

UK
The UK economy ended 2015 on a firmer footing than previously thought, but the current account deficit widened to a record high level in the final quarter of the year. Britain's gross domestic product increased 0.6% in the three months through December, compared with the 0.5% gain reported last month, according to the Office for National Statistics. The revision came due to better performance of the services sector, which rose at a faster pace of 0.8%, industrial output and construction. On the expenditure side, the strongest upward driver again came from consumers, with household expenditure increasing 0.6% to 267.4 billion pounds during the reported period, helping to offset a 2% decline in business investment and weak exports. The UK economy grew 0.4% in the third quarter. The annual growth in the fourth quarter was also revised, by two percentage points up to 2.1%. 

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