Thursday October 23, 2014 Search
Weather | Athens
22o C
16o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
ECB to keep interest rates low as European economy revives, says central bank official

By Jeff Black

The European Central Bank will keep interest rates low as the economy picks up because the region’s economic output is still below potential, according to Executive Board member Sabine Lautenschlaeger.

“The output gap we acknowledge by our forward guidance,” Lautenschlaeger said in an interview in the Wall Street Journal. “Interest rates will remain at the present level, or even lower, over a longer period of time and well into the recovery.”

The comments represent an extension of the Frankfurt-based ECB’s pledge on interest rates, known as forward guidance, and distill arguments made by President Mario Draghi last week for the first time. Even as output data improve in the 18-nation region, the ECB is signaling it won’t tighten monetary conditions too soon and choke off the recovery.

“We’re receiving some positive signals from incoming data, for example economically with a modest recovery trend and financially with improving funding conditions for banks,” Lautenschlaeger said, adding that the central bank still has measures it can use, like asset purchases or negative interest rates, to stimulate growth.

After the ECB kept its interest rates on hold on March 6, Draghi said that while policy makers hadn’t seen a need to act now, they agreed that monetary conditions need to remain loose as the recovery grips, “because of the existing slack in the economy.”

While the recovery remains fragile, data in the past four weeks have been encouraging. Gross domestic product in the bloc climbed 0.3 percent in the fourth quarter, more than economists predicted and bolstered by stronger expansions in Germany, France and the Netherlands. Italy also returned to growth.

Economic forecasts released by the ECB last week, which covered 2016 for the first time, predicted that inflation should be around 1.7 percent by the end of that year. That’s near the central bank’s goal of just below 2 percent and more than double last month’s rate of 0.8 percent. It projected growth will firm to 1.8 percent in 2016 from 1.2 percent this year.

“We’ll act if it is necessary,” Lautenschlaeger said. “But there was no strong reason to act: Last week we, the Governing Council, found our baseline scenario broadly confirmed.”

[Bloomberg]

ekathimerini.com , Tuesday March 11, 2014 (11:14)  
TBEX brings together 800 travel bloggers in Athens
Athens weighs its LNG and CNG options
Greece ranks among global leaders in tourism growth
Global oil price drop sends local fuel prices back to 2010 levels
Cyprus president to sit out EU summit due to high blood pressure
Cyprus President Nicos Anastasiades was admitted to a hospital in Brussels on Thursday morning following repeated nosebleeds caused by high blood pressure. He was discharged a few hours late...
Strong winds hamper sea travel
Winds reching 7 and 8 Beaufort led to disruptions in Saronic Gulf sea travel services from and to Piraeus, the Greek coast guard said on Thursday morning. Services were also disrupted on the...
Inside News
SOCCER
Roberto´s heroics make Kasami´s goal count
Pajtim Kasami’s goal and Roberto’s heroics in goal saw Olympiakos claim one of the biggest wins in its history on Wednesday downing Italian champion Juventus 1-0 to boost its chances of reac...
SOCCER
Third-division Iroditos punished heavily after fan death
Greek third division team Irodotos has been docked 15 points and ordered to play 10 matches behind closed doors following the death of an Ethnikos Piraeus supporter, the Hellenic Football Fe...
Inside Sports
COMMENTARY
Defusing a crisis
The crisis in Cyprus is escalating rapidly and defusing it is an extremely delicate and complicated procedure that will inevitably lead to losses for the weakest of the two sides. The course...
EDITORIAL
PM needs to step up
The public perception of the government is anything but good right now. The coalition is projecting an image of discord and constant disputes show that key ministers are unable to stay on th...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Cyprus president to sit out EU summit due to high blood pressure
2. Strong winds hamper sea travel
3. TBEX brings together 800 travel bloggers in Athens
4. Roberto´s heroics make Kasami´s goal count
5. Athens weighs its LNG and CNG options
6. Greece ranks among global leaders in tourism growth
more news
Today
This Week
1. TBEX brings together 800 travel bloggers in Athens
2. Strong winds hamper sea travel
3. Cyprus president to sit out EU summit due to high blood pressure
4. At least 11 banks to fail European stress tests, three in Greece, report says
5. Cyprus to block Turkey's EU talks after EEZ violation
6. EU’s Juncker wins Commission-team approval with investment vow
Today
This Week
1. Coalition shooting itself in the foot
2. Istanbul skyscraper casts shadow over Greece's banking ambitions
3. Greece’s closed society is central to its current malaise
4. The past, present and future of the Greek debt crisis
5. Greece must stick to reforms, says Schaeuble
6. At least 11 banks to fail European stress tests, three in Greece, report says
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.