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3 Jun 2015
ECB wants Greece to stay in Euro – ECB’s Draghi
FXStreet (Mumbai) - The ECB President Draghi, in his reply to a question about Greece said the governing council of the ECB wants Greece to stay in the Euro.
“The governing council of the ECB wants Greece to stay in the Euro, but there should be a strong agreement. One that creates growth, and which is fiscally sustainable and addresses the remaining sources of financial instability.”
GDP forecast for 2017 revised lower
The ECB projections now see 2017 GDP at 2.0%, compared to the forecast of 2.1% in March. Meanwhile, GDP forecast for 2015 and 2016 have been kept unchanged at 1.5% and 1.9% respectively.
However, Draghi added that the central bank was expecting stronger growth figures, while stating that slower external growth is hurting the Eurozone economy.
On rising bond market volatility
Draghi said the yields could rise on the back of an improving economy and inflation numbers. He further added that the volatility seen in the bond markets may be technical. The rise in the yields on short-term German paper above the deposit rate (-0.2%) has made them eligible for the QE program.
The bank is ready to look through volatility and implement its QE program, and policymakers are not in favor of changing the program in response to high volatility.
“The governing council of the ECB wants Greece to stay in the Euro, but there should be a strong agreement. One that creates growth, and which is fiscally sustainable and addresses the remaining sources of financial instability.”
GDP forecast for 2017 revised lower
The ECB projections now see 2017 GDP at 2.0%, compared to the forecast of 2.1% in March. Meanwhile, GDP forecast for 2015 and 2016 have been kept unchanged at 1.5% and 1.9% respectively.
However, Draghi added that the central bank was expecting stronger growth figures, while stating that slower external growth is hurting the Eurozone economy.
On rising bond market volatility
Draghi said the yields could rise on the back of an improving economy and inflation numbers. He further added that the volatility seen in the bond markets may be technical. The rise in the yields on short-term German paper above the deposit rate (-0.2%) has made them eligible for the QE program.
The bank is ready to look through volatility and implement its QE program, and policymakers are not in favor of changing the program in response to high volatility.