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Draghi: 'no need to deviate' from ECB policy path

Thursday, April 06, 2017 - 01:49

The European Central Bank is set to stick to its policy plan, including bond purchases and record-low rates for some time to come, as it has yet to be convinced that the euro zone's economy is back to rude health. As David Pollard reports, the comments by the ECB's President, Mario Draghi, sent the euro to a three-week low.

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All eyes on ECB policy as Mario Draghi gets ready to speak in Frankfurt. Would he give any hint the central bank's ready to pull back on its 2.3 trillion euro stimulus programme? Despite the suspense - the answer a clear 'no' ..... (SOUNDBITE) (English) ECB PRESIDENT, MARIO DRAGHI, SAYING: "I do not see cause to deviate from the indications we have been consistently providing in the introductory statement to our press conference." But with German industry orders bouncing back in February, the other question was: why shouldn't he rein in stimulus? New data shows bookings up 3.4 per cent - just a day after euro zone PMI readings were reported at near a six-year high. Even peripheral economies sharing in the rebound. (SOUNDBITE) (English) LCG SENIOR ANALYST, JASPER LAWLER, SAYING: "It's a sign that some of these more struggling economies are actually starting to benefit from the ECB's stimulus, from higher inflation, higher prices and just a number of years past the euro zone debt crisis where confidence is starting to improve again." Inflation did though drop back to 1.5 per cent in March - still some way shy of the ECB's target of close to two per cent. And until inflation does hit target, the euro zone has other challenges. (SOUNDBITE) (English) HEAD OF CORPORATE DEVELOPMENT, 7IM, JUSTIN URQUHART STEWART, SAYING: "Not least of which the political issues of the elections in Germany and Germany, but also of course what happens with Brexit. This of course is still very important to the euro zone. So much better that they leave it probably over the summer. Probably quarter three, quarter four, that's when we'll see some pulling back of the support being given." In the meantime, the euro slid to a three-week low on Draghi's comments. A weaker single currency not a stated policy aim for the ECB - but one exporters will greet nonetheless.

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Draghi: 'no need to deviate' from ECB policy path

Thursday, April 06, 2017 - 01:49