The ECB leaves it at 0% interest rates and kept its program of stimulus – The Reporter

Mario Draghi, head of the ECB

interest Rates at 0%, deposit facility to 0.4 percent and purchases of debt of 80,000 million euros. As expected, nothing changes at the first meeting of the year of the ECB despite the fact that the shadow of deflation is already in the background.

The internal division within the monetary institution and the pressure of Germany standing as the protagonists of this first meeting of the year, which coincides with the number 1.001 of the council of the European Central Bank (ECB).

The types will remain in the 0%

at the moment, as expected, the governing council of the ECB, which today celebrated its meeting 1.001 has not changed its roadmap. This means that the price of money will continue in the 0% and the deposit facility at-0.4%. In addition, according to the three-quarters of the experts surveyed by Bloomberg may not be any change in the monetary policy of the ECB until the meeting of 7 September.

in The same way, the main agency european monetary has confirmed that it will continue to pump money into the euro zone at the rate of 80,000 million euros per month until the end of march 2017, in order to then reduce the amount of 60,000 million until the month of December, “or until a later date if necessary and, in any case, until the governing Council to note an adjustment is sustained on the path of inflation that is compatible with its inflation target”, according to the press release by the ECB itself.

The don’t move tab, Mario Draghi, the ECB president, expected also to see how changing the monetary policy of the Federal Reserve with Donald Trump as the president of the united States. All indications are that the plans Trump could accelerate the economic growth and lead the Fed to raise rates at a faster pace than initially anticipated. In fact, Janet Yellen said yesterday that will rise the interest rates, “a few times a year until the end of 2019″, something that did not surprise the markets.

Division

Since the agency’s monetary move tab in December have increased the number of voices against it. The ECB extended in your last appointment their purchases of debt nine months, from march to December of 2017, although from April it will reduce the amount of these monthly purchases from the 80,000 million up to 60,000 million.

however, the minutes of this meeting which saw the light last week, showed the division within the ECB’s precisely for that re-calibration of the QE that took place in December. “Some members” were opposed to the two proposals, indicate those minutes when the goal once more chasing the main monetary institution in the euro zone was to achieve price stability, i.e. an inflation rate of close but below 2% over the medium term.

inflation pressure

And there comes on the scene the other big issue being discussed today, the inflation. The rebound in prices (inflation in the eurozone soared in December to 1.1% from 0.6% prior and touched its highest level since 2013) fueling debate on the desirability of the cash injections carried out by the ECB.

This issue is exacerbated further especially in the hand of Germany, one of the countries most critical of Mario Draghi, the president of the ECB, for its policy of ‘zero rates’ which causes them to lose purchasing power and more this year in which elections are held in the largest economy of the eurozone. At the beginning of the year, when inflation reached 1.7%, Germany moved publicly new pressures on the agency money to put an end to its expansionary policy.

the following quote from The ECB will be on the 9th of march.