The eurozone’s economic downturn is proving a boon for policymakers who are jostling to succeed Mario Draghi at the bloc’s central bank — offering them an opportunity to tout favored policy proposals and burnish their credentials for the job.
Analysts expect the European Central Bank (ECB) to acknowledge growing risks to the eurozone economy on Thursday while sticking to its patient course, kicking off a year that could see the Frankfurt institution mostly marking time.
The eurozone needs a few mega banks that can compete on the world stage, and banks need a deposit insurance scheme, Daniele Nouy, the head of the European Central Bank’s supervisory board, said on Wednesday.
European Central Bank President Mario Draghi has declared that eurozone economic growth is on a steady course and that the risk of deflation is fading, allowing the central bank to phase out its bond-purchase program by the end of December.
Ten years since the European Central Bank raised interest rates, only to reverse course within months after Lehman Brothers Holdings Inc. collapsed and markets seized up, policy makers are still defending their action.
The euro to US dollar exchange rate fell to its lowest level since last November amid new political uncertainties in southern Europe, which occurred also against the backdrop of eurozone growth slowdown since the beginning of 2018.