Home Today's Paper Most Popular Video Gallery Photo Gallery
Subscription Blog Signin Register
Logo
Saturday, September 22, 2018 08:21:40 AM
Follow Us On: Facebook Twitter Twitter Twitter Twitter
BREAKING NEWS:

'Exciting' ECB meet could bring end to bond-buying

By
13th-Jun-2018       
Comments
Share your thought
Post a comment »
Read all () »

AFP, Frankfurt  :
The European Central Bank may announce Thursday a timetable for withdrawing its massive support for the eurozone economy, analysts say, although looming threats to the bloc could stay its hand for a few more weeks.
Central bankers' monthly bond purchases of 30 billion euros ($35 billion) and ultra-low interest rates are designed to stoke growth in the 19-nation single currency area and power inflation to their target of just below 2.0 percent.
Growth has picked up across the bloc, although at a slower pace in early 2018 than last year - 0.4 percent between January and March compared with 0.7 percent in the previous three months.
Meanwhile, eurozone price growth surged to 1.9 percent in May, in line with the ECB's target.
"Core" inflation discounting the most volatile elements remains weak, but the data suggest that over 2.4 trillion euros of "quantitative easing" (QE) or mass bond-buying since 2015 has dispelled the risk of deflation, or a downward spiral of prices braking economic activity.
At their Thursday meeting in Latvian capital Riga, "the governing council will have to assess whether progress so far has been sufficient to warrant a gradual unwinding of our net purchases" of bonds, top ECB economist Peter Praet said last week.
Central bank President Mario Draghi has until now said governors did not even discuss a possible exit from QE at their gatherings.
That makes the topic's appearance on the agenda an important signal that the end is approaching.
"After Praet's remarkable speech, we expect a very exciting meeting on 14 June," ING Diba bank economist Carsten Brzeski said.
But policymakers may not yet be convinced that the time is right to remove the training wheels completely.
The current list of threats to the eurozone ranges from the new Italian government's unpredictable spending policies, which could pitch the bloc's third-largest economy into a financial crisis, to the prospect of a failure to reach a Brexit deal with London.
An acrimonious end to the G7 summit on Saturday heightened the risk of a tit-for-tat trade war between EU nations and US President Donald Trump, while higher oil prices could weigh on future growth.
What's more, "recent data on business activity have not been strong enough to rule out further disappointment on the growth outlook - a risk that the ECB would find difficult to respond to" if it ties itself to a fixed exit strategy from bond-buying, said economist Frederik Ducrozet of Pictet bank.
Against that background," "a 'flexible tapering' (winding down bond purchases) announcement is more likely than an unconditional commitment to an end date for QE," on Thursday, he predicted.
"We still don't think the ECB will easily give away flexibility and room for manoeuvre on QE," Brzeski agreed.
Analysts are divided about what exactly such flexibility would look like, and whether policymakers will make their move this month or next.
Draghi could announce a gradual reduction of purchases to zero over several months but leave his options open to increase them again.
Or the ECB could opt for an open-ended extension of bond-buying beyond the current cutoff date of September, but at a slower pace than the present 30 billion euros per month.
How the institution communicates its retreat from QE will be watched closely by investors.
The central bank has long said interest rates will not rise until "well after" the end of bond purchases - meaning whether or not the institution names an end date could have big implications for financial markets.

Tariff
Add Rate

News Archive

Inside The New Nation

Editorial »

Rohingya crisis: UN is helpless without active cooperation of int'l community


THE United Nations was established with a mission to stop brutality and promotion of human rights across the globe but at present is apparently helpless to stop the Myanmar military atrocity on Rohingya ethnic community. Though the Universal Declaration of Human Rights, International Covenant on Civil and Political Rights, the ...

Cricket »

India rout Pakistan by eight wickets in Asia Cup


AFP, Dubai :India crushed Pakistan by eight wickets in their long-awaited Asia Cup match which failed to live up to its hype in Dubai on Wednesday.Pace spearhead Bhuvneshwar Kumar (3-15) and part time off-spinner Kedar Jadhav (3-23) sent Pakistan, who won the toss and batted, collapsing to just 162 all ...

Football »

We aim to play SAFF U-16 Women's final: Choton


Bangladesh U-18 national women's football team head coach Golam Rabanni Choton said they aim to play the final of the SAFF U-18 Women's Championship which is scheduled to be held from September 28 to October 7 in Thimpu, Bhutan.He was speaking at a pre-departure press conference on Thursday at the ...

International »

US-North Korea relations making 'tremendous progress': Trump


President Donald Trump on Wednesday said US relations with North Korea are making "tremendous progress" from the days before his presidency when the two countries appeared close to "going to war."Trump said a recent letter from North Korean leader Kim Jong Un confirmed the positive track, which he said has ...

City »

Newly elected executive members of Bangladesh Photo Journalists Association paid a courtesy call on Shipping Minister Shajahan Khan at his ministry on Thursday.


Entertainment »

Not always necessary to do issue-based films: Yami Gautam


Actress Yami Gautam, who stars in Batti Gul Meter Chalu, says it is neither necessary nor possible for an actor to do issue-based films all the time. Yami was interacting with the media here on Wednesday at a promotional press conference of the film that releases on Friday. She was ...

Football »

Japanese MMA star Norifumi 'Kid' Yamamoto dies at 41


Tributes flowed Wednesday for charismatic Japanese Mixed Martial Artist ( MMA) Norifumi "Kid" Yamamoto, who died at age 41, three weeks after announcing a battle with cancer.Born to a family of wrestlers and martial artists, the wiry, tattoo-covered Yamamoto took on larger opponents in a wide range of MMA events, ...

Editorial »

Ecological danger for destroying forest by Rohingyas


A STUDY has revealed that 4,300 acres of hills and forests have been razed in Cox's Bazar to set up refugee camps and cooking fuel for Rohingyas who fled ethnic cleansing in Myanmar. Quoting the study, news media reported that about 3,000-4,000 acres of hill land at Teknaf and Ukhia ...

International »

Kim agrees to dismantle main nuke site if US takes steps too


AP,  Pyongyang :The leaders of North and South Korea announced a wide range of agreements Wednesday which they said were a major step toward peace on the Korean Peninsula. But the premier pledge on denuclearization contained a big condition, with North Korean leader Kim Jong Un stating he'd permanently dismantle ...

International »

Sex with Trump 'least impressive' she's ever had: Daniels


Stormy Daniels, the porn star who claims to have slept with Donald Trump over a decade ago, says in her upcoming tell-all book that it may have been the "least impressive sex" she'd ever had, The Guardian reported Tuesday.In her book, "Full Disclosure," Daniels also provides a graphic description of ...

Entertainment »

I`m seen as a fierce and opinionated woman post Bigg Boss: Hina Khan


Actor Hina Khan believes Bigg Boss helped her showcase her real personality, which is that of a woman who does not shy away from speaking her mind. The actor became one of the most talked about contestants on the 11th edition of the reality TV show, which has just begun ...

City »

Dhaka University teachers formed a human chain programme on the campus on Wednesday demanding release and proper treatment of BNP Chairperson Khaleda Zia.


Editorial »

We welcome Islamabad for awarding Bangladeshi-origin refugees Pakistan`s nationality


PAKISTAN government has decided to grant nationality to all Pakistan-born refugees of Bangladeshi and Afghan origins staying there for decades. Prime Minister Mr Imran Khan on Sunday made this announcement during his maiden visit to Karachi, saying the Bangladeshi and Afghan refugees who were born in Pakistan would get National ...

Sports »

Argentina's Facundo Conte (left) and teammate Alexis Gonzalez celebrate during the Men's World Championships' volleyball match between Argentina and Slovenia, in Florence, Italy on Monday.


Football »

FIFA president Infantino has doubts about La Liga match in Miami


AFP, Barcelona :FIFA president Gianni Infantino has expressed concern about La Liga's proposal to stage a fixture between Girona and Barcelona in the United States.The two clubs have each approved a request submitted to the Spanish Football Federation for the match to be played at the Hard Rock Stadium in ...

 
Items that you save may be read at any time on your computer, iPad, iPhone or Android devices.
 
Are you new to our website? Do you have already an account at our website?
Create An Account Log in here
Email this news to a friend or like someone
Email:
Write a comment to this news