Arab Today, arab today ecb set to talk up stimulus measures but hold fire
Last Updated : GMT 02:17:55
Arab Today, arab today
Arab Today, arab today

ECB set to talk up stimulus measures but hold fire

Arab Today, arab today

Arab Today, arab today ECB set to talk up stimulus measures but hold fire

Given the alarming drop in eurozone inflation in recent months
Frankfurt - AFP

The European Central Bank, at its final meeting of the year on Thursday, will prime the markets for new anti-deflation measures, but will wait until early next year to act, analysts said.
Given the alarming drop in eurozone inflation in recent months, the heat has increased on the ECB to undertake massive stimulus measures like central banks in Britain, Japan and the United States have done.
According to official data, inflation in the 18 countries that share the euro slowed to 0.3 percent in November from 0.4 percent the previous month, feeding fears of imminent deflation.
Falling prices may sound good for the consumer, but they can trigger a vicious spiral where businesses and households delay purchases, throttling demand and causing companies to lay off workers.
The ECB is scheduled to publish its own latest updated inflation and growth forecasts and is worried that medium-term inflation expectations could become permanently de-anchored from its target of around 2.0 percent.
The ECB has already launched a multi-pronged offensive against deflation, cutting its interest rates to new all-time lows, making unprecedented amounts of cheap loans available to banks via its LTRO and TLTRO programmes, and unveiling asset purchase programmes (ABSs and covered bonds) to pump liquidity into the financial system.
But it has also hinted at more radical action in the form of quantitative easing (QE), a policy used by other central banks around to stimulate their sluggish economies.
QE is the large-scale purchase of government bonds and such a policy has many critics in Europe, not least the German central bank or Bundesbank, because it is felt that it takes the ECB outside its remit and is effectively a licence to print money to get governments out of debt.
- 'Not if, but when' -
"The ECB will aim to send out a strong message this Thursday that it will do what it takes to raise inflation and inflation expectations as fast as possible," said Berenberg Bank economist Christian Schulz.
"Even if it does not step up its actions just yet, it will choose language for the statement that makes additional easing a near certainty for the first quarter of 2015," the expert said.
"The question is no longer if, but when and what."
Last week, the ECB's number two, Vitor Constancio, said the central bank would be in a position to gauge whether the previous stimulus measures are working in the first quarter of 2015.
"If not, we will have to consider buying other assets, including sovereign bonds in the secondary market," Constancio said.
Just days prior to that, ECB chief Mario Draghi had vowed to "step up the pressure and broaden even more the channels through which we intervene ... without any undue delay."
Nevertheless, ECB-watchers are sceptical that QE will be announced as soon as Thursday.
"With little action and much emphasis on the feel-good factor and good team spirit, this week's ECB meeting should fit into the contemplative pre-Christmas atmosphere," said ING DiBa economist Carsten Brzeski.  
"At the very least, we expect the ECB to indicate that it is planning more aggressive purchases in the nearer term," said Ben May at Oxford Economics.

 

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today ecb set to talk up stimulus measures but hold fire Arab Today, arab today ecb set to talk up stimulus measures but hold fire

 



Arab Today, arab today
Arab Today, arab today Mohamed Bahari prepares new collection for spring 2017

GMT 06:15 2017 Monday ,27 February

Mohamed Bahari prepares new collection for spring 2017
Arab Today, arab today 17.4 million tourists visit UAE in 2016

GMT 00:47 2017 Monday ,27 February

17.4 million tourists visit UAE in 2016
Arab Today, arab today Sheds light on major steps in 12-year career

GMT 06:07 2017 Monday ,27 February

Sheds light on major steps in 12-year career
Arab Today, arab today UN envoy sets out framework

GMT 07:25 2017 Monday ,27 February

UN envoy sets out framework
Arab Today, arab today Ayat Abaza says state TV presented major stars

GMT 03:52 2017 Sunday ,26 February

Ayat Abaza says state TV presented major stars
View News in Arabic - Business: مصارف
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Reasons for the delay 'On the Stairs of Servants'

GMT 06:42 2017 Saturday ,25 February

Reasons for the delay 'On the Stairs of Servants'
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 07:23 2017 Friday ,24 February

Ola Ghanem hopes to work with M.Ramadan

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years

GMT 18:23 2017 Friday ,24 February

Fadi explains secrets of  Nancy Ajram's newlook

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"

GMT 10:51 2017 Saturday ,25 February

Pigs with edited genes show resistance

GMT 14:04 2017 Friday ,24 February

Messi visit will contribute in tourism

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 01:04 2017 Tuesday ,28 February

Nokia 3310 is back — and so is 'Snake'

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday