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ECB raises eurozone growth forecast

European Central Bank head Mario Draghi says the eurozone economy is picking up.

The head of the monetary authority for the 19-country eurozone said that the bank was raising its growth forecast for this year to 1.5% from 1%.

"Looking ahead, we expect the economic recovery to broaden and strengthen," he told reporters after the bank kept its key interest rate on hold at its monthly meeting.

He said the ECB would on Monday start its 1.1 trillion euro bond-buying programme that aims to stimulate the recovery and raise the rate of inflation from a dangerously low minus 0.3%.

The ECB will buy 60 billion euro (£43 billion) per month in government and corporate bonds starting on Monday.

Economists say the economy is showing signs of life in part due to increased confidence based on hopes for the stimulus programme. Lower oil prices and a weaker euro have helped as well.

"The pressure on Draghi and co has eased somewhat in recent months as inflation data has been better than expected and oil prices are creeping up from historic lows," said Dennis de Jong, managing director at brokerage

"There is a real chance that the economies of Europe may have turned the corner - and all before the bond buying commences on March 9."

The ECB held its meeting in Nicosia, the capital of the Mediterranean island state of Cyprus, one of two meetings per year it holds away from its headquarters in Frankfurt, Germany.


From Belfast Telegraph