Global economy: Shafts of sunshine try to pierce thick clouds
By Alan Wheatley, Global Economics Correspondent
LONDON (Reuters) - Global economic news is improving here and there, but a batch of data due this week is unlikely to shake financial markets' conviction that major central banks are not about to take away the punch bowl.
If anything, even more monetary easing could be in the pipeline.
A minority of policymakers at the Bank of England wants to expand its bond buying. The nominee to head the Bank of Japan is promising profound change to root out deflation.
Even the conservative European Central Bank (ECB) pondered a further interest rate cut last week after its staff forecast that the euro zone would not only remain in recession in 2013 for the second year in a row but would shrink by more than previously thought.
Extraordinarily loose global policy settings speak volumes about how much spare capacity there still is in the post-crisis world economy - despite Friday's surprisingly strong U.S. job figures.
"My best guess is that the output gaps are sufficiently large in all the major economies that central banks can do additional stimulus if need be," said Derry Pickford, macro analyst at investment managers Ashburton in London.
LOTS OF SLACK
U.S. retail sales are likely to have risen 0.5 percent in February, according to a Reuters poll of economists. Continued...