HONG KONG (Reuters) - The European Central Bank's interest rates are "very low" and its monetary policy stance has become more accommodative than at the peak of the financial crisis, ECB policymaker Juergen Stark said on Tuesday.
FRANKFURT — The European Central Bank cut interest rates to record lows on Thursday, imposing negative rates on its overnight depositors to cajole banks into lending more and to fight off the risk of Japan-like deflation.
The cut, the first time the ECB has deployed a negative deposit rate which effectively charges banks to deposit overnight, was a response to a slowdown in inflation far below the ECB’s target and to weak eurozone lending.
OTTAWA — Count on Mario Draghi to set the tone.
The head of the European Central Bank, who not long ago proclaimed he would “do whatever it takes” to right the region’s listing economy and support its common currency, is again attempting to aggressively lead the way in global monetary policy.
And that way is down.
FRANKFURT (Reuters) - European Central Bank policymaker Juergen Stark dismissed the idea of common euro zone bonds being a solution to the currency bloc's debt crisis and said leaving interest rates too low for too long was risky.
Reuters - European Central Bank policymaker Juergen Stark dismissed the idea of common euro zone bonds being a solution to the currency bloc's debt crisis and said leaving interest rates too low for too long was risky.
Reuters - The European Central Bank's interest rates are very low and a scaling down of its support measures is warranted, a senior ECB policymaker said on Tuesday but another played down the risk from inflation.
For months, financial market participants have speculated about whether the European Central Bank will implement negative deposit rates or large-scale quantitative easing to counteract persistently low levels of inflation in the euro zone. But at Credit Suisse’s 17th Annual Asian Investment Conference this week in Hong Kong, Dr. Jürgen Stark, a former member of the European Central Bank’s Executive Board and former Vice President of the Bundesbank, said such extraordinary measures are not warranted. The euro zone is not in danger of deflation, he said.
OTTAWA — While Canada’s economy should pick up later this year, there are external and domestic threats that — if unchecked — could make a case for more interest rate cuts, according to the International Monetary Fund.
The IMF said in a report Thursday that Canada’s economy will grow by 1.8% in 2013, hobbled by a weak second-half handover from the previous year.
But gross domestic product is expected to speed up “thanks to the strengthening of the U.S. economy from mid-2013,” with the IMF pegging Canadian growth at 2.3% for 2014.