Today the President of the European Central Bank Mario Draghi once again reiterated that the regulator plans to up their dovishness in their approach to monetary policy across the eurozone. Draghi first spoke about this a few days ago, stating that the current economic underperformance in Europe might require another round of stimulus measures, as well as a possible interest rate cut.
During today’s gathering of the European heads of state, Draghi assured them that there are no fears of a crisis in Europe and that the economies of member states are healthy. However, the ECB is not seeing growth at the rates that it is hoping to. The global trade conflicts, even the one between China and the United States that seems like it doesn’t concern Europe directly, have had a negative impact on economic development across the world.
Draghi said that if these global conflicts are not resolved and the slowdown continues, the ECB’s hand will be forced to resort to more stimulus. Recall that the last round of QE packages ended in December 2018 in hopes that the economy will be even stronger in 2019.
This was Mario Draghi’s last such event as President of the ECB. His mandate will be over in October when someone else will inherit his post and his responsibilities.
