Draghi Keeps Rates on Hold in Face of Ger­man Back­lash

But ECB’s Draghi pledges loose pol­icy ‘as long as needed’

The Economic Times - - Companies: Pursuit Of Profit -

Ger man F i n a n c e Mini s t e r Wolf­gang Schaeu­ble sharply at­tacked ECB poli­cies, ar­gu­ing they were caus­ing “ex­tra­or­di­nary” prob­lems for Ger­many and were in part to blame for the rise of the right-wing anti-im­mi­gra­tion Al­ter­na­tive for Ger­many (AfD).

Draghi re­peat­edly stressed that in­fla­tion re­mained far off the bank’s tar­get of near two per­cent and ar­gued that the euro zone econ­omy still faced a cocktail of e xt e r nal r i s ks and would be in a worse state to­day had the ECB not re­sorted to neg­a­tive in­ter­est rates to ac­com­pany a 1.7 tril­lion euro ($1.92 bil­lion) money-print­ing scheme.

“Our poli­cies work, they are ef­fec­tive. Just give them time to fully dis­play their ef­fects,” he said. “Global un­cer­tain­ties per­sist. Look­ing for­ward, it is es­sen­tial to preserve an ap­pro­pri­ate de­gree of mon­e­tary ac­com­mo­da­tion as long as needed.” He said the bank would be­gin buy­ing cor­po­rate bonds as part of its quan­ti­ta­tive eas­ing pol­icy in June.

ECB to be­gin buy­ing cor­po­rate bonds as part of its quan­ti­ta­tive eas­ing pol­icy in June

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