In addition to the decision on new and unexpected cut in interest rates (which "was not unanimous"), today the European Central Bank also gave the green light to a program of purchases of securities securitized by bank loans (ABS) disbursed to households and non-financial companies. This was announced by the president of the ECB, Mario Draghi, during the press conference held at the end of the Governing Council. The plan will have a substantial impact on the balance sheet of the Central Bank together with the Tltro, i.e. loans for a total of one billion euros for the benefit of the banks but tied to the granting of loans.
The Eurotower number one specified that “the measures launched today are oriented towards credit easing, however it is clear that ABS will be purchased only in the presence of guarantees, a bit like the Fed did a few years ago. The modalities are new, because there is a direct purchase of securities, but for ten years the Abs have been given as a guarantee to the ECB to obtain loans”.
Furthermore, the board "is unanimous" in its determination to take further action against the risk that inflation in the Eurozone will remain very low for an excessively prolonged period, Draghi reiterated, revealing that during today's meeting "there was also discussion of a Quantitative Easing”, i.e. a generalized purchase plan of financial securities: “Some members of the Governing Council have made it clear that they would have liked to do more than decided, while others would have preferred to do less”.
As for the prospects for the near future, the central bank has revised downwards its forecasts for inflation in the euro area for 2014 from 0,7% to 0,6%, keeping those for 2015 unchanged (at 1,1. 2016%) and for 1,4 (2014%). The 2015 and 1 GDP growth estimates were also cut (respectively from +0,9 to +1,7% and from +1,6 to +2016%), while those for 1,8 were raised by +1,9 to +XNUMX%.
"Many of the data received since August have shown that the recovery is losing momentum", Draghi said again, underlining once again the importance of "structural reforms", because "there is no monetary or fiscal stimulus that can absence of important legal interventions”, which could be launched through a “sharing of sovereignty” of individual countries with the EU authorities. In any case, only after the reforms will it be possible to benefit from the margins of flexibility already provided for in the treaties, which obviously do not imply "any overcoming of the rules".
