March 11, 2016
The European Central Bank’s president, Mario Draghi, fired off a salvo of measures yesterday aimed at strengthening the eurozone’s tepid recovery – but ended up shooting down his own “bazooka” by triggering turmoil in currency markets.
The ECB’s broader than expected package included upping the size of its monthly €60bn (£47bn) money-printing programme by €20bn, and expanding the scope of the scheme beyond government bonds to other assets.
The central bank also cut its main interest rate to zero and lowered its deposit rate even further into negative territory at minus 0.4 per cent, in effect charging banks more to hold deposits with it. Four long-term loan schemes were also announced, with banks given incentives to boost credit growth with cheaper rates.
Mr Draghi is bidding to lift the inflation rate – currently minus 0.2 per cent – and growth, which was just 0.3 per cent in the latest quarter.
This article was posted: Friday, March 11, 2016 at 8:47 am