El-Erian Says ECB Is Trying a Packaged Approach

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.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza