Restive bond markets may complicate ECB's exit plans

London

THE European Central Bank has its work cut out this year to make sure markets don't jump the gun on its policy normalisation.

Currency strength and a doubling of benchmark borrowing costs over just two months may be tightening euro zone financial conditions faster than the ECB would like, potentially jeopardising its timeline to exit stimulus.

The central bank has successfully engineered a recovery from the economic doldrums via three years of hefty asset purchases known as quantitative easing (QE).

But as investors anticipate a retr…