Monday, 09 December 2019
Jakarta
--:--
Tokyo
--:--
Hongkong
--:--
New York
--:--
Draghi Talks Tough on Stimulus as ECB Discusses More Rate Cuts
Thursday, 6 June 2019 21:26 WIB | MONETARY | ECBMario Draghi

Mario Draghi hardened his language as he said the European Central Bank won™t shy away from action to support the euro-area economy as growth weakens.

Policy makers are œdetermined to act if needed, citing the œprolonged persistence of uncertainties and the œrising threat of protectionism, the ECB president said in Vilnius after the Governing Council met. Some officials raised the prospect of interest-rate cuts or restarting quantitative easing and there is œconsiderable headroom for more QE, he added.

council extended its pledge to keep interest rates at record lows and announced details on a program for infusing lenders with more cheap cash. That wasn™t enough for some investors in a week when global central banks including the Federal Reserve turned more dovish. German bond yields and the euro rose. Still, bank stocks gained on the details of the long-term loans.

Trade tensions buffeting the global economy have spurred monetary policy makers to move toward easing. Australia reduced rates on Tuesday for the first time in three years and India cut for a third time this year on Thursday, while Fed Chairman Jerome Powell shifted closer to acting.

Draghi said ECB economists downgraded their outlook for growth and inflation next year. The euro-zone economy is now seen expanding 1.4% in 2020 compared with a March forecast for 1.6%. Inflation is seen at 1.3% this year, 1.4% next year and 1.6% in 2021 -- well below target.

The long-term loans to banks will start in September and initially be priced at the main refinancing rate plus 0.1 percentage point. They can fall as low as the deposit rate plus 0.1 percentage point if banks meet lending benchmarks. The main refinancing rate is currently zero, and the deposit rate is minus 0.4%.

Market-based inflation expectations are at their lowest since 2016, a trend that Draghi said policy makers take seriously, while stressing that there is no threat of deflation and a very low probability of recession.

The ECB™s action on Thursday œtakes into account the prolongation of uncertainty with respect to what we saw and believed in March, Draghi told reporters, citing Brexit and rising populism as well as trade.

Markets œmight see a much broader phenomena, where the multilateral order that we have lived in since World War II is disappearing, he said. œAnd then of course the uncertainty about Brexit negotiations, the uncertainty of vulnerabilities of certain emerging-market countries, which are important.

Source: Bloomberg

RELATED NEWS
BOJ Maintains Key Interest Rates and Forward Guidance...
Tuesday, 30 July 2019 10:06 WIB

Bank of Japan maintains 10-year JGB yield target at about zero percent after ending a two-day meeting on Tuesday. Keeps policy balance rate at -0.1%. Central bank leaves forward guidance and asset p...

Powell says the Fed is 'grappling' with whether to cut interest rates...
Wednesday, 26 June 2019 00:28 WIB

Federal Reserve Chairman Jerome Powell on Tuesday suggested an interest-rate cut in July, widely expected by investors and economists, is not a done deal. While greater uncertainty about trade and wo...

Draghi's speech: Global trade has faced headwinds in recent years...
Wednesday, 12 June 2019 15:38 WIB

The European Central Bank (ECB) President Mario Draghi, via Reuters, delivering the opening address at the ECB conference on Central, Eastern, and South-Eastern European countries (CESEE), in Frankfur...

BOJ Menjaga Kebijakan Tidak Berubah, Mengurangi Perkiraan Inflasi...
Friday, 15 June 2018 10:01 WIB

Bank of Japan meninggalkan kebijakan moneter tidak berubah bahkan ketika menurunkan penilaian inflasi, turun lebih jauh di belakang rekan globalnya pada akhir minggu yang sibuk bagi bank-bank sentral....

LATEST NEWS
Gold Prices Near Flat; Fed Meeting, Trade News Eyed

Gold prices stayed near flat on Monday in Asia as traders awaited the U.S. Federal Reserve meeting later this week and updates on the Sino-U.S. trade developments. U.S. Gold Futures were little changed at $1,464.85 by 1:10 AM ET (05:10 GMT). The...

Tokyo Stocks Close Up for Third Straight Session

Tokyo stocks rose for a third consecutive session Monday, extending rallies on Wall Street as investors closely watched key events this week including central bank meetings and the UK elections. The benchmark Nikkei 225 index climbed 0.33 percent,...

FBI Investigating Shooting at US Naval Base as Terrorism

The FBI is investigating the fatal shooting at a Naval base in Florida as an act of terrorism, a special agent said Sunday. Rachel Rojas, special agent in charge of the FBI's Jacksonville office, told a news conference Sunday that the...

POPULAR NEWS
Gold falls 1% after robust US jobs data
Saturday, 7 December 2019 03:06 WIB

Gold slid 1% on Friday as strong U.S. jobs data renewed bets the Federal Reserve would hold pat on interest rates and boosted demand for riskier...

Gold Futures Drop as U.S. Payrolls Rise More Than Expected
Friday, 6 December 2019 21:04 WIB

Gold futures plunged, erasing a weekly gain, as stronger-than-expected U.S. jobs data helped ease economic concerns that had fueled demand for...

Gold Heads for 2nd Weekly Gain as Trade, Jobs in Focus
Friday, 6 December 2019 15:58 WIB

Gold headed for a second weekly advance as developments in the trade war took center stage and as traders waited for key monthly U.S. jobs data...

Hong Kong stocks finish week on positive note (Review)
Saturday, 7 December 2019 04:32 WIB

Hong Kong closed more than one percent higher Friday, boosted by renewed hopes that China and the United States will eventually reach a partial...