[ad_1]
FRANKFURT, Germany (AP) – The European Central Bank is questioning measures to deal with growth fears and weak inflation, just two days after the US Federal Reserve opened the door to an increased recovery.
Speculation that the bank could act to revive the economy has increased as market expectations for inflation have subsided, a sign of growing pessimism about the economy. of the economy.
Both the ECB and the Fed have suspended their efforts to withdraw stimulus measures set up following the Great Recession and the global financial crisis. Concerns about the global economy now suggest that the Fed could cut interest rates in its next phase.
President Jerome Powell said on Tuesday that the Fed was ready to react if it decided that the Trump administration's trade disputes are threatening the US economy. Investors interpreted it as a sign that the Fed was likely to cut interest rates later this year.
Markets and badysts are waiting to see what the Governing Council of the ECB will decide Thursday at a meeting in Vilnius, Lithuania, where the bank, headquartered in Frankfurt, holds its annual road meeting. President Mario Draghi will hold a press conference after the meeting.
The bank could notably indicate that it offers very favorable interest rates as part of a series of long-term and cheap loans already announced.
The purpose of the credit is to replace the first cheap money injections that will expire in the coming months, so that the banks do not tighten the credit to the companies. Some badysts believe that the ECB could impose a negative interest rate on credit under certain conditions, which means that banks would be paid to take the money.
The ECB could then make lending conditional on companies by forcing banks to obtain cheap money, which will stimulate more stimulus and credit in the economy.
[ad_2]
Source link
