sabato 5 novembre 2011

Well done Mario!!!

Last Thursday Mario Draghi in his debut as President of the ECB took an unpredictable decision by cutting the main refinancing operations interest rate by 1/4 to 1.25%. Draghi demostrated great courage even though it was a unanimous decision. Obviously, such a small rate cut is unlikely to restore confidence and boost growth in the euro area, albeit it is crucial to ease the credit market and the sovereign bond market too, expecially in an environment of slowing inflation and stable inflation expectations. Furthermore, the ECB continued to purchase (though not so effectively) Italian and Spanish bonds on the secondary market.
To sum up, despite his nationality and against all the odds of being "more German than Germans" Draghi acted decisevely to a more accomodative monetary policy.

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