The European Commission yesterday upgraded its economic forecasts for the euro zone, adding to the ever-growing swathe of data suggesting the region is in recovery. Euro zone unemployment has continued to fall, the manufacturing sector is booming, while inflation is estimated to have hit 1.9% last month - in range of the European Central Bank's target. All of that has added to the pressure on ECB president Mario Draghi, who has so far resisted calls for the bank to start unwinding its massive quantitative easing programme earlier than planned.

"It's certainly Springtime in Europe as far as the economy is concerned," said Eugene Kiernan, Head of Investment at Appian Asset Management. "What we've seen, though, have been revisions though growth - this year and next year - maybe bubbling just under 2%."


That is positive but perhaps suggests an amount of fragility, which Mr Draghi seems all to aware of. "Mario Draghi was talking in the Hague on Wednesday and he was very clear on this. He said 'it's too early to declare victory, it's too early to declare success'," Mr Kiernan said. "Given all the effort they've put in in terms of time and money and quantitative easing it's still too premature in terms of moving away from that."

While central banks like to be ahead of the economy, so that they are playing catch up when the hard data starts to shift, Mr Kiernan said he feels that the ECB still has plenty of scope to take a relaxed approach to its next step. He points out that unemployment is still around 9.5% in the euro zone - which means there is still plenty of capacity there for expansion before the likes of consumer prices begin to spiral out of control. Overall, the ECB will be keen not to choke off the growth that is beginning to materialise as a result of some knee-jerk reaction to what is happening at present.

But central banks are always willing to tweak their plans, and the Bank of England has suggested it may start to raise interest rates sooner than expected depending on the economic data. The fact that that would not happen until some point in 2019 gives people plenty of time to prepare - but it does show that the current expectations are never set in stone.

"I think it's a really interesting inflection point for the data in the UK economy at the moment," Mr Kiernan said. "It has been very resilient since the referendum last year but what we've seen in the last couple of weeks have been some signs of weakness - certainly in terms of retail sales, and yesterday manufacturing data was a bit softer. The Bank of England has almost a dual mandate - yes to fight inflation but also to support the economy and to support business activity and I suspect that they will ere on the side of caution as far as interest rates are concerned."

Meanwhile on the other side of the Atlantic, the US Federal Reserve is well on its path of higher interest rates. It has already upped the rate once this year and markets expect at least one more rise in the coming months. According to Chicago Federal Reserve chief Charles Evans, he expects two - or possibly three - rate rises this year - and maybe even as may as four if the data is strong enough. This puts the Fed on a very different path to its European equivalent, but Mr Kiernan does not feel that creates an issue for either side.

"It's not going to be a surprise - I think the US Fed is on track for a series of rate rises and I think it's going to be a gentle upward staircase effect," he said. "There's no reason why they shouldn't - they're at their inflation target, their economy is at full employment and global activity is picking up, so at this stage there's no reason for the US not to move on interest rates," he stated.

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MORNING BRIEFS - The Revenue Commissioners received more than 2,300 disclosures of overseas income ahead of a deadline for declarations last month, according to the Minister of Finance. In response to a Dáil question from Fianna Fáil's Michael McGrath, Michael Noonan said that the disclosures had a value of more than €70m. He said some disclosures are still being processed, which means the final number could be even higher. People who made a voluntary disclosure of overseas income to Revenue by the 4th of May faced a discounted penalty of 10%, while they also escaped the risk of prosecution. However those who did not make a disclosure in time could now be hit with higher penalties and having their name listed in the Tax Defaulters' List, as well as potential prosecution.

*** Non-bank lender Finance Ireland says it almost doubled its pre-tax profit in 2016 after a substantial jump in new lending. The firm has announced a pre-tax profit of €6.3m for last year , up 91% on 2015. Finance Ireland offers commercial mortgage lending, auto finance, leasing and agri-finance - and is one of the partners of the Strategic Banking Corporation of Ireland. Last year it had more than €300m in new lending, up 82%, while its net assets grew by 81%. Finance Ireland said it now had €520m worth of assets under management.

*** Marketing and sales firm HubSpot is to extend its footprint in Dublin after agreeing a pre-lease deal with property company Hibernia REIT. HubSpot already leases 27,500 square foot of space in Hibernia's One Docklands Central and had previously agreed to take 16,000 square foot in the adjoining Two Docklands Central, which is currently being redeveloped. However the firm has now doubled that pre-lease deal - meaning it will take 32,000 square foot of space when the building comes on stream later this year. ENI has also agreed to pre-let a further 5,500 square foot of the building. This means that three quarters of its space has already been taken ahead of its completion.