Arab Today, arab today ecb revs up markets
Last Updated : GMT 04:36:39
Arab Today, arab today
Arab Today, arab today

With talk of fresh stimulus

ECB revs up markets

Arab Today, arab today

Arab Today, arab today ECB revs up markets

European Central Bank President Mario Draghi
Frankfurt - Arab Today

The European Central Bank sought Thursday to assuage market disappointment over its recent anti-deflation policies by promising to revisit the level of euro area interest rates and other stimulus measures in March.
At its first policy meeting of 2016, the ECB held its key interest rates unchanged, as had been widely expected.

But Draghi said the central bank could review its monetary policy stance at its next meeting in March, immediately sparking a rally in stock markets and bringing down the euro.

"The decisions taken in early December ... were fully appropriate," Draghi insisted, rejecting suggestions that they had been too timid.

"Yet, as we start the new year, downside risks have increased again amid heightened uncertainty about emerging market economies' growth prospects, volatility in financial and commodity markets, and geopolitical risks," Draghi said.

"In this environment ... it will therefore be necessary to review and possibly reconsider our monetary policy stance at our next meeting in early March, when the new staff macroeconomic projections become available."

- 'Determined to act' -

The ECB was "determined" to do everything in its power to steer eurozone inflation back up towards levels conducive to healthy economic growth, and there were "no limits" as to how far it is prepared to go in that respect, Draghi said.

"We have the power, willingness and determination to act."

A long series of policy moves by the ECB over the past 18 months -- ranging from interest rate cuts, the provision of unprecedented amounts of cheap liquidity and a controversial programme of bond purchases -- has failed to steer stubbornly low inflation back up to the target level of close to but just under 2.0 percent.

Area-wide inflation stood at a meagre 0.2 percent in December.
But "we are not surrendering," Draghi insisted.

At its last meeting in December, the ECB cut its key "deposit" rate by 0.10 percentage point to minus 0.30 percent and extended the length of its asset purchase programme known as quantitative easing or QE by six months to March 2017.

At the time, those decisions disappointed financial market players, as they had expected much more decisive action.

Some ECB watchers argued that the tentativeness of the moves was an indication of divisions within the central bank's 25-member governing council regarding the need for more action, an interpretation apparently backed up by the minutes of the meeting, released earlier this month.

According to the minutes, "some" members had argued "that the existing policy measures ... should be given time for them to unfold their full effect ... before adopting further monetary policy measures."
- 'No divisions' -

But Draghi denied there was disagreement within the ECB on the matter.

"There are no such divisions," Draghi said.

Analysts were cheered by the ECB chief's New Year message.

"What was expected to be a dull first meeting of the year turned out to be an exciting (one)," said ING DiBa economist Carsten Brzeski.

"Draghi sounded much more concerned about the outlook for the eurozone economy," the expert said.

"He explicitly mentioned the renewed sharp drop in oil prices, the appreciation of the euro and the slowdown of emerging markets and China."

He also mentioned the volatility in financial and commodity markets as one of the factors behind the increase in downside risks, Brzeski noted.

"The question, however, is whether and what the ECB can really deliver in March."

RBS economist Andrew Cates said he had previously been pencilling in further easing in June.

"But in light of today's dovish rhetoric, we have pulled forward the timing of that forecast for further easing to March."

Cates predicted that the ECB could pare back its deposit rate still further by 0.10-0.15 percentage point and boost the size of its QE purchase programme.

Commerzbank economist Michael Schubert said Draghi's comments were "in line with our prediction of further measures, although we still think another rate cut more likely than an increase in the monthly volume of asset purchases."
Source: AFP

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 revs up markets Arab Today, arab today ecb revs up markets

 



Arab Today, arab today
Arab Today, arab today Nohan Seyam designs beautiful accessories

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today Tourism shows signs of recovery

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today 11 family members dead in rebel push

GMT 07:57 2017 Tuesday ,21 February

11 family members dead in rebel push
Arab Today, arab today To probe sexual harassment claims

GMT 10:08 2017 Tuesday ,21 February

To probe sexual harassment claims

GMT 06:51 2017 Saturday ,18 February

Blames government for economic crisis

GMT 06:35 2017 Saturday ,18 February

MP calls for re-operating closed companies

GMT 13:35 2017 Friday ,17 February

Confirms Britain is biggest investor in Egypt

GMT 15:55 2017 Thursday ,16 February

Egyptian foods completely unobserved nor healthy

GMT 11:18 2017 Wednesday ,15 February

Reveals plan to get out of financial crisis

GMT 12:33 2017 Tuesday ,14 February

Yemeni accuses militias of challenging oil

GMT 18:07 2017 Monday ,13 February

Over 3000 workers lost their jobs
View News in Arabic - Business: أخبار الاقتصاد
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today 57 monkeys carrying 'invasive' genes

GMT 16:00 2017 Tuesday ,21 February

57 monkeys carrying 'invasive' genes
Arab Today, arab today 63-Year-Old Woman Delivers Baby

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby
Arab Today, arab today Small ponds have outsized impact

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Competes Sweden and Germans by S90

GMT 22:36 2017 Thursday ,16 February

Competes Sweden and Germans by S90
Arab Today, arab today Ahmed Fahmy stresses he did not ignore singing

GMT 06:34 2017 Sunday ,19 February

Ahmed Fahmy stresses he did not ignore singing
Arab Today, arab today London to tax old cars

GMT 14:06 2017 Friday ,17 February

London to tax old cars

GMT 21:11 2017 Saturday ,18 February

Egypt to hold first session of Arab film festival

GMT 06:50 2017 Wednesday ,15 February

Tragic fluctuations of Bakhtiari's life revealed

GMT 12:22 2017 Monday ,20 February

Kanye West puts hijab-wearing model

GMT 20:41 2017 Wednesday ,15 February

Teach monkeys to recognize themselves in mirror

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 14:51 2017 Monday ,20 February

Ways to acquire presentation skills

GMT 19:16 2017 Friday ,17 February

Aziz House ready to host the tourists

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:39 2017 Monday ,20 February

newest smartphone another winner for Huawei

GMT 16:08 2017 Wednesday ,15 February

Shawsh reveals her collection "Jewelry of dreams"
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