With a series of measures announced Thursday, the European Central Bank has fired a “lots of small bullets” at the euro zone’s growth-sapping disinflation, but so far, the markets are not sure it will work, former Pimco co-CEO Mohamed El-Erian told CNBC on Thursday.
The central bank decided to take the unprecedented step of imposing a negative interest rate on banks for their deposits as part of an array of initiatives to spur economic growth.
“So they move simultaneously on lots and lots of fronts, knowing that the experience away from them hasn’t been great on a standalone,” El-Erian said on “Squawk on the Street.” “They’re trying a package approach hoping that somehow they’re going to get to critical mass.”
But, the chief economic adviser at Allianz added, the moves are “a little bit like firing lots and lots of small bullets” rather than a big bazooka.
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