Daring Draghi

With Eurozone inflation below 1% and falling, and the money supply barely growing, the European Central Bank may have to become very creative to stave off deflation. Here’s why: while it might have authority to buy sovereign bonds, due to political considerations it would have to slavishly buy them in proportion to the economic weight of each country in the Eurozone rather than focus their purchases where deflation already exists.

Recent Posts

Categories