As expected, the European Central Bank (ECB) has announced its decision to continue its asset purchase programme beyond the end of the year. Until December of this year the ECB will purchase bonds totalling 60 billion euros each month, dropping down to 30 billion euros a month from January 2018 until at least September 2018. Professor Friedrich Heinemann, head of the Research Department “Corporate...
Southern European countries profit in a disproportionate way from the bond-buying programme of the European Central Bank (ECB), with the largest bias towards Spain and Italy. Within the framework of the Public Sector Purchase Programme (PSPP), national central banks and the ECB have purchased Spanish and Italian government bonds whose volume exceeds Spain’s and Italy’s share in gross domestic...
The US Federal Reserve decided to keep its benchmark rate in a range between 1.0 and 1.25 per cent in September 2017. At the same time, the Fed announced that it will start shrinking its $4.5 trillion balance sheet in October. With the interest rate outlook remaining unchanged, another rate hike is likely to happen this year. Professor Friedrich Heinemann, head of the “Corporate Taxation and...
As expected, the European Central Bank (ECB) announced today that, once again, it would not be adjusting its base rates, nor would it be making any changes to its outlook on interest rate policy. The outlook on the bond purchase programme remains equally unchanged from July’s communiqué, as the ECB confirmed the programme’s continuation. Professor Friedrich Heinemann, head of the Research...
As expected, the European Central Bank (ECB) has announced to make no changes to its key interest rates and bond-buying programme. In its latest decision, the ECB has, however, taken into account the persistently high growth rates in the eurozone as well as the increased inflation rate. ECB President Mario Draghi expects the economic growth prospects in the eurozone to improve even further. Dr....
Despite increasing economic and political confidence in the eurozone, the European Central Bank (ECB) is still yet to reach the point of changing its outlook regarding its monetary policy and has continued to suggest that even lower ECB interest rates are on the cards. Professor Friedrich Heinemann, head of the "Corporate Taxation and Public Finance" Research Department at the Mannheim Centre for...
The European Central Bank (ECB) has decided to leave its key interest rates unchanged and to continue its bond-purchase programme as planned until the end of the year. Professor Friedrich Heinemann, head of the ZEW Research Department "Corporate Taxation and Public Finance" at the Centre for European Economic Research (ZEW), comments on the ECB's decision. - "The ECB does well to not adopt...
The European Central Bank (ECB) has decided to reduce the interest rate for the marginal lending facility to zero per cent, and that for the deposit facility from minus 0.3 to minus 0.4 per cent. In addition, the ECB has extended its asset purchasing programme, "Quantitative Easing", by a further 20 billion, thus providing a total of 80 billion euros, and determined a further liquidity programme...
Professor Fuest, President of the Centre for European Economic Research (ZEW), comments today's ECB decision: "The ECB was right to decide against an extension of monthly asset purchases. The effectiveness of extending this policy in providing stimulus is limited. Highly indebted households and firms will not invest and consume more if the ecb buys more assets and creditors are increasingly...
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