A modest retreat. The European Central Bank announced a new package of cheap loans and a delay of an expected rate hike in a bid to prevent a slowdown from turning into a downturn. With Italy already in recession and Germany teetering on the precipice, the central bank loans, known as targeted longer-term refinancing operations, are intended to encourage commercial banks to keep lending. Additionally, the new round of two-year loans will cushion the impact of the previous round’s coming due starting in June 2020. The ECB has not, however, reversed course on its 2.6 trillion-euro ($2.9 trillion) bond-purchasing program, which ended in December. The ECB also cut its 2019 growth projections for the eurozone to 1.1 percent from 1.7 percent. On Wednesday, the Organization for Economic Cooperation and Development cut its 2019 growth forecast for the eurozone to 1 percent from 1.8 percent; for Germany to 0.7 percent from 1.4 percent; and for Italy to -0.2 percent from 0.8 percent.

Moving money. The U.S. is preparing sanctions against foreign banks that are helping Venezuelan President Nicolas Maduro move and hide money, a top U.S. administration official told Reuters on Wednesday. This comes after reports that the Venezuelan government has moved the headquarters and other assets of companies like oil firm PDVSA and aluminum producer Venalum to Moscow. (PDVSA accounts are reportedly being moved to the Russian Financial Corporation bank, which is also under U.S. sanctions.) Meanwhile, Venezuelan opposition leader Juan Guaido told German magazine Der Spiegel that the government’s expulsion of the German ambassador was a “serious threat” and urged Europe to increase financial sanctions against the government. Maduro hasn’t given up hope of negotiating a settlement and said he would support Turkey’s role in mediating talks. Such talks seem unlikely at this point as the opposition has said it will only discuss plans for Maduro’s removal from office.

Another attack and a crackdown. Less than a month after a suicide bomber killed 46 people in India-controlled Jammu and Kashmir, sparking Indian airstrikes in Pakistan, exchanges of artillery fire, and a dogfight between India and Pakistan, a grenade exploded Thursday at a bus stop in Jammu. One person was killed and at least 30 were injured. A suspected member of Hizbul Mujahideen, a Pakistan-sponsored Kashmiri separatist group, was arrested. Separately, the Pakistani government said Thursday that it had seized control of 182 religious schools and arrested over 100 people in a crackdown on Islamist militants. Pakistan’s interior minister had previously confirmed a Dawn newspaper report that the crackdown was imminent, insisting it was unrelated to the flare-up with India. There has been no response to the latest attack from the Indian government, but in light of reports that the Indian airstrikes on a militant base in Pakistan were unsuccessful, and with elections coming in the next two months, public pressure on the Indian government to show that it can manage cross-border militant threats will be high.

Honorable Mentions

  • Chinese telecommunications firm Huawei is suing the U.S. government in a Texas district court, arguing that a law restricting U.S. government dealings with Huawei or companies that use its equipment as a substantial component of their systems is unconstitutional.
  • German federal spending is expected to rise in 2019 due to higher welfare stipends and pensions, giving the economy a slight jolt, according to an Economy Ministry document seen by Reuters.
  • Israel bombed a Hamas naval commando base early Thursday after a projectile was fired at southern Israel from the Gaza Strip. An unnamed Palestinian security official said the Israeli strike caused damage but no injuries.
  • The Scottish National Party’s deputy leader said a new referendum on separating from the U.K. could happen even without the British Parliament’s sanction, a legal requirement for such a vote.
  • With two weeks to go until elections in Thailand, a Thai court banned the Thai Raksa Chart Party, which nominated Princess Ubolratana Rajakanya for prime minister last month.