Friday, 6 November 2015

Eurozone is still weak

The ECB [European Central Bank], which wants inflation of just below 2%, has been injecting 60 billion euros a month of new money through its bond-buying program since March to support growth and inflation in the 19-country currency area.

With a slowdown in China and energy prices continuing to fall, ECB President Mario Draghi said on Tuesday policymakers would review the monetary stimulus and may beef up the program at the bank's next meeting in December.

The BoE [Bank of England] also wants inflation of just below 2% and of course uses sterling not the Euro, found services companies rebounded more strongly than expected last month, suggesting economic growth picked up speed as the final quarter began.

While no change in policy is expected from the Bank of England when it meets on Thursday, economists think it will raise rates from record lows in the second quarter of next year. If we were in the Euro we would not have the ability to make these decisions for ourselves, so hopefully we will remain were we are.

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