Frankfurt (Germany), February 4 (EFE) .- The president of the European Central Bank (ECB), Mario Draghi, today sent a signal back to the March monetary entity shall apply more monetary stimulus in the euro area.
he favored Draghi that the ECB acts against low inflation in the euro area.
confirmed willingness to expand monetary policy further, after having anticipated after the meeting of the governing Council in mid-January and the Wuropeo Parliament earlier this month.
at a conference organized by the Bundesbank with celebrate one year of the unified banking supervision, Draghi said in Frankfurt that “there are forces in the global economy today come together to keep inflation low.”
“These forces can cause inflation slow return to our goal, but there is no reason why they should lead to a permanently low inflation rate, “he added Draghi.
He added that” what is important is that central banks acting within their mandates to meet them. “
” in the euro area, this can create different challenges than it does in other jurisdictions. But these challenges can be mitigated. Do not justify inaction risks of acting too late weigh the risks of acting too soon “,” Draghi, who at the time said he said. “
For now, analysts agree that the ECB forecast the more expensive bank deposits to a day at the entity and evolve depending on how the current turmoil in financial markets, whether reassuring or not, decide to do something else.
the deposit interest rate is already in the euro area at -0.30%.
With this measure, the ECB wants the banks to lend to the real economy and slowing the appreciation of the euro because it reduces deposits in the region.
the situation in China, movements in stock markets and oil prices are the factors that will determine the aggressiveness with which act the ECB in March.
slower growth in China, the fall in investments in that country and the fall in oil prices are the main downside risks for growth and inflation in the euro area.
in March the ECB will release its new macroeconomic projections for growth and inflation. Of them also depend on the extent to which decide to apply more or less stimulus.
The ECB predicted in December growth in the euro area for 2016 of 1.7% and 1.9% for 2017, with inflation at 1 and 1.6% respectively.
the European Commission (EC) today downgraded tenth its growth forecasts for the eurozone for 2016 to 1.7% and remained at 1, 9% 2017 figures coincide with the ECB December to a “more pronounced” external risks.
the annual inflation in the eurozone in 2016 will stand at 0.5% before up to 1.5% next year, according to the EC.
the BoE also revised down its forecasts for growth and inflation this year and next.
should the situation in the financial markets stabilize and the ECB also revised down its inflation forecasts, it is likely that the entity decides in March also other monetary stimuli such as buying more government debt.
Draghi defended the unconventional monetary policy measures implemented since the summer of 2014 and said they have had an effect equivalent to a cut in the interest rate of 100 basis points in “normal” conditions transfer.
in his speech, the Italian economist stressed that the current arguments against applying further measures are not plausible given that aims to achieve a rate of medium-term inflation slightly below 2%.
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