ECB Weighing Stimulus Options

The European Central Bank looks set to inject fresh stimulus into the eurozone’s economy on Thursday after its president, Mario Draghi, said he and his policymakers would “do what we must” to return inflation from its current level of 0.1 per cent to their target of less than 2 per cent “as quickly as possible”.

Mr Draghi’s hints at action have been so strong that doing nothing would risk huge disappointment in financial markets. A slowing recovery and lacklustre inflation present a compelling case for doing more for most of the rate-setting governing council, despite staunch opposition from German policymakers and a handful of others on the 25-strong committee.

Since late October, officials from across the single currency area have congregated in Frankfurt to brainstorm on what the central bank could do. The fruits of those discussions are set to reach members of the governing council over the next few days.

Here are five changes the ECB could make. The most likely course is a mix of some, or even all, of the five.

via CNBC

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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