Money Minute Wednesday 12 February: grim times for European industry

Good morning and welcome to Money Minute, where we preview the day's biggest financial stories.

Over in the eurozone, the latest data on industrial production is due to be released. It’s likely to show that December was a grim month for manufacturing in the region. More timely survey data suggests that thing picked up a little in January. But overall, things still look grim for the sector as we head into 2020 – and that’s before taking into account the impact of the coronavirus.

In the US, Federal Reserve head Jerome Powell continues his half-yearly testimony to US politicians. Markets will be most interested in hearing about potential changes to the US central bank’s inflation targeting regime.

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Put simply, the Fed is considering changing its inflation target to allow inflation to rise above 2% for a prolonged period of time, to compensate for the prolonged period of below-target inflation we’ve seen.

In practical terms, that means the Fed would be under no immediate pressure to raise interest rates, even if inflation takes off. Investors would no doubt welcome this change, at least for the time being.

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