Belfast Telegraph

Draghi confident eurozone is 'through the worst'

By John Fraher

European Central Bank president Mario Draghi said recent economic indicators have signalled that the eurozone was now through the worst. And he reiterated that officials planned to keep interest rates low.

"Confidence indicators have shown some further improvement from low levels and tentatively confirm the expectation of a stabilisation in economic activity," said Mr Draghi at a press conference in Frankfurt after the ECB kept its benchmark rate at 0.5%.

Policymakers expect to keep borrowing costs "at the present or lower level for an extended period of time," he said, repeating a formula first deployed last month.

Mr Draghi was trying to assure financial markets that the ECB will keep borrowing costs low enough to foster a recovery from the eurozone's longest-ever recession and that it won't tighten policy too soon, as it did in 2011.

Earlier, the Bank of England's nine-member Monetary Policy Committee held its target for quantitative easing at £375bn and the interest rate at 0.5%.

On Wednesday, the US Federal Reserve pledged to keep buying $85bn (£56bn) in bonds every month and didn't give any indication of the timing for trimming debt purchases.

The ECB last month took the unprecedented step of giving investors forward guidance on its rate expectations, joining the Fed and other central banks in trying to provide a clearer picture of its thinking.

Belfast Telegraph

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