Euro area economic confidence jumps to highest since 2011

Euro-area economic confidence jumped to the highest since 2011 at the end of last year after the European Central Bank extended its stimulus and the recovery in the 19-nation region showed further signs of strengthening.

An index of executive and consumer sentiment increased to 107.8 in December from a revised 106.6 in November, the European Commission in Brussels said on Friday.

Economic momentum accelerated at the end of last year to the fastest in more than 5 1/2 years, according to a survey of purchasing managers, as the ECB extended quantitative easing to ensure a sustained pickup in inflation in a year of political uncertainty. While a surge in the cost of oil propelled consumerprice growth to the strongest in more than three years in December, underlying inflation pressures remained weak.

While the ECB will lower asset purchases to 60 billion euros a month starting April, it prolonged the program that started in March 2014 through the end of the year. Policy makers have justified the reduction in the monthly QE amount with a “firming” economic recovery.

France, Germany and the Netherlands will hold general elections in the next 12 months that are set to bolster support for populist parties, while the U.K. will start negotiating terms of its exit from the European Union and Donald Trump assumes the presidency in the U.S.

During the past week, the MSCI All-Country World Index had a weekly gain of 1.7 percent. The Stoxx Europe 600 Index fell 0.1 percent on Friday, trimming a weekly advance, as commodity producers declined.

The S&P 500 rose 1.7 percent in the week, the most since the 9 December. The Nasdaq Composite and Nasdaq 100 indexes advanced, with both closing at all-time highs. The Dow climbed and capped a weekly gain of 1 percent.