Tagged deflation

The ECB enters a new era in monetary policy

The European Central Bank (ECB) is to start buying up sovereign bonds from 9 March. Its president, Mario Draghi, believes that the programme of unprecedented monetary stimulus in the Eurozone will succeed in stemming the threat of deflation in the region. Next week will see an enormous machinery set in motion for the purchase of public debt on a mass scale from the 19 countries in the monetary union. Known as quantitative easing (QE), this has now been renamed by the ECB as the Public Sector Purchase Programme (PSPP) and will consist of bond purchases up to €60bn per month.

In the past inflation was the number one enemy of economists. Nowadays, you might find that the exact opposite is true, and that a fall in prices is now in the spotlight. Deflation has arisen as the main threat to the economy, and the European Central Bank (ECB) is under pressure to take decisive measures against it. Prices in the Eurozone have seen the first year-on-year decline in five years, according to Eurostat.

© 2024 Katoikos, all rights are reserved. Developed by eMutation | New Media

 

It Looks Like You Have AdBlocker Enabled

Katoikos.world and FOGGS

rely on your support

Consider making a donation

 

More info here