Extra mild ECB tapering of QE and zero interest rates keep euro low

Last Thursday, Mario Draghi, the President of the European Central Bank performed again his superb balancing act, between the needs of the South and the demands of the North. He led the Governing Council of ECB, Eurozone’s most powerful body, to map the exit road from the extraordinary monetary measures (Quantitative Easing) state as frictionlessly […]

Why the ECB prepares to flood the markets with more and free of charge euro; everybody needs that now

Mario Draghi’s statement of last Thursday from Malta that the European Central Bank’s “monetary policy accommodation will need to be re-examined at our December monetary policy meeting”, offered a strong support to all major capital markets, with stocks gaining a lot of ground and the euro receding slightly. Understandably, a generous increase of ECB’s monthly […]

Greece: Tsipras’ referendum victory does not solve the financial stalemate of the country and its banks

The imperative economic realities for the Greek Prime Minister Alexis Tsipras will not be altered noticeably after his crushing win in yesterday’s referendum. His ‘no’ (OXI in Greek) option marked an overwhelming victory meaning that the Greeks rejected the latest offer from the country’s creditors. To be reminded, during the past five months the Greek […]

A Monday to watch the final act of a Greek tragedy; will there be catharsis or more fear?

Today’s Eurogroup summit of the 19 euro area heads of state and government is convened by Donald Tusk, the President of European Council in order to bluntly present Alexis Tsipras, the Greek PM with a final ultimatum; ‘comply or leave the Eurozone’. Of course this initiative was not Tusk’s, given that his mandate is rather […]

More billions needed to help Eurozone recover; ECB sidesteps German objections about QE

The Eurozone economy has been taking two steps forward and one step backward over the past few months. The minimal increase of the GDP growth rate to 0.4% during the first quarter of this year and the equally small increase of people in employment was accompanied by a fall of industrial production and a decrease […]

ECB with an iron hand disciplines the smaller Eurozone member states; latest victim: Greece

Last Monday the President of the European Central Bank, Mario Draghi reacted strongly while answering a MEP’s question in the European legislature. He was asked if the ECB is “blackmailing” and financially “suffocating” Greece. As expected, he denied the accusations. Was he right though? Rather not. Only some hours afterwards the central bank ordered the […]

Deep chasm still divides Athens and Brussels; can Eurozone use the nuclear arm of liquidity against Greece?

Today the Eurogroup, the 19 Eurozone ministers of Finance at 3 o’clock in the afternoon will start discussing the future of Greece. It’s quite uncertain if a decision will be reached. Late last Saturday the technical consultations for the Monday meeting were concluded in Brussels. The preliminary work was realized by a group comprising Greek […]

ECB’s unconventional monetary measures give first tangible results

A strong statement was delivered last week by Mario Draghi, President of the European Central Bank. He ascertained that the monetary measures already taken unanimously by the central bank’s Governing Council, “will enhance our accommodative monetary policy stance”. Those measures have led to an easing of the euro/dollar parity favouring a cheaper single money, a […]

Predicting two more years of economic stagnation

Yesterday, as expected, the European Central Bank kept its basic interest rate unchanged at 0.25%. As usually, the decision was taken in the meeting of the bank’s Governing Council, the first of 2014. At this almost zero interest rate cost commercial banks get ample liquidity from the ECB and then lend this money to the […]

ECB should offer more and cheaper liquidity if Eurozone is to avoid recession

The fact that monetary policy is the only common policy applied invariably in the 18 still widely diverging Eurozone economies, means that the European Central Bank is the unique euro area institution, which thinks and acts on a really European level. In this respect, the latest statements by its President, Mario Draghi, are quite pertinent. […]

Draghi cuts the Gordian knot of the Banking Union

Mario Draghi, the President of the European Central Bank, had three messages to send yesterday to Eurozone’s political leaders. He did that while answering journalists’ questions, after the regular monthly meeting of the Governing Council, which left the basic interest rate unchanged at 0.5%. For the first time Draghi puts a big question mark over […]

The banks want now free capital from taxpayers

Benoît Cœuré, a Member of the Executive Board of the European Central Bank, delivered a speech today on “The implications of bail-in rules for bank activity and stability”. This was the opening speech at conference on “Financing the recovery after the crisis – the roles of bank profitability, stability and regulation”, staged by Milan’s Bocconi […]

Eurozone banks are unable to support real economy’s dawning growth

Industrial production in the European Union is definitively in a virtuous path as statistical data confirm business managers’ assessment, that their order books are as full as they have never been in the past. The same is true for industrial production. According to a press release published yesterday by Eurostat – the EU statistical service […]

Eurozone: Retail sales betray economic frailty

Retail sales are an infallible measurement of the internal dynamism or its absence in every economy. They are tightly associated with consumption which is by far the largest component of Gross Domestic Product, investments and exports accounting for the rest of it. For quite some time now retail trade dynamism in Eurozone is practically non-existent […]

ECB guarantees the liquidity of the Atlantic financial volume

There is no doubt that the European Central Bank is determined not only to continue supporting Eurozone’s real economy with liquidity at almost zero interest rate cost for as long as it needs to achieve tangible growth, but by the same token it appears ready to succeed the American Fed in keeping the western financial […]

ECB offers plenty and cheap liquidity to support growth in all Eurozone countries

The rare and openly confirmed unanimity of European Central Bank’s Governing Council that interest rates should remain at their present or even lower levels for a long time, didn’t only gave a cause for celebrations in all European bourses, but it also induced some analysts to comment that Eurozone’s recession may be more persistent than […]

Can the EU last long if it cuts Cyprus out?

The latest and most important rhapsody in the Cyprus tragedy was performed yesterday morning by the twenty-three members of the European Central Bank’s governing council. The text issued by them was very brief and went like this: “The Governing Council of the European Central Bank decided to maintain the current level of Emergency Liquidity Assistance […]

South Eurozone needs some…inflation and liquidity

As it was expected, Eurostat proved to be right in its last week’s estimate that February yearly inflation was less than 2% on the average in the 17 member states Eurozone. As a matter of fact yesterday’s announcement of the EU’s statistical service revealed that February inflation was 1.8%. Inflation rates diverged wildly between the […]