Quantitative easing prolonged and rates still at zero. These are the main decisions made by European Central Bank, which extended the plan for the purchase of government and financial bonds, aimed at normalizing inflation, throughout 2017.
Quantitative easing will therefore last 9 months longer than the deadline set for March 2017, extending until December. The monthly amount of the maneuver remains confirmed at 80 billion euros but only until March, from April, however, it will return to the original amount of 60 billion euros per month.
The European Central Institute also confirmed the main one at zero refinancing rate of the euro area and at minus 0,40% the rate on deposits held on behalf of banks. The rate on marginal refinancing operations was also confirmed at 0,25%. The announced decisions are quite in line with the expectations of analysts and the market.
"The slow growth of the Eurozone is dictated by the absence of structural reforms and budgetary adjustments: however, we expect a moderate but continuous pace of growth in the Eurozone": these are the words ofthe Mario Draghi in the press conference following the board of the ECB which decided to extend the Quantitative easing until the end of 2017, but reducing purchases to 60 billion euros.
“Structural reforms – added the number one of the Eurotower – must absolutely be accelerated, in all the countries of the Eurozone, to reduce structural unemployment, stimulate growth and increase productivity. With an accommodating monetary policy, the structural reforms will help the euro area to better absorb international shocks: but it is essential that all countries increase their efforts to implement policies that are more favorable to economic growth”.
The president of the European Central Bank also spoke of Italy, of the banking system but also of the government crisis: "'I think that the vulnerabilities of the banking system and of Italy have been around for a long time and therefore need to be resolved. I am confident that the new government will know what to do and that these problems will be solved". Regarding the time that Italian banks should have to put their accounts in order, however, Draghi preferred not to answer and said that "on the basis of the principle of separation of duties, these are things you have to ask the supervisory board of the ECB" .
Draghi then added that quantitative easing could be increased and extended "even beyond next year, if necessary". After the announcement European stock exchanges increased their gains: it was above all Piazza Affari that benefited, which in the mid-afternoon was the best stock exchange on the continent with a gain of 1,63%, now well over 18.000 basis points.
