Time for a regime change in Frankfurt

Inflation in the Eurozone remains far below target and market expectations of future inflation have hardened at very low levels, indicating that investors have lost confidence in the European Central Bank's (ECB's)ability to fulfil its mandate. The eurozone’s anaemic economic recovery is faltering, which will put further downward pressure on prices, while the weakening world economy will not provide the external stimulus that the ECB hoped for. The central bank needs to be bold and make it clear it will do everything required to raise inflation. Unfortunately, it is likely to err on side of caution, as it has in the past, damaging eurozone growth prospects and calling into question the sustainability of many member-states’ debt burdens.

ESO: Background information: Monetary policy decisions, 10 March 2016 / ECB adds corporate sector purchase programme (CSPP) to the asset purchase programme (APP) and announces changes to APP / ECB announces new series of targeted longer-term refinancing operations (TLTRO II) http://www.europeansources.info/record/monetary-policy-decisions-10-march-2016-ecb-adds-corporate-sector-purchase-programme-cspp-to-the-asset-purchase-programme-app-and-announces-changes-to-app-ecb-announces-new-series-of-targeted/

---