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The European Central Bank (ECB) today unveiled its widely anticipated Quantitative Easing programme. But can it really boost inflation and growth in the Eurozone? Has the ECB compromised on the structure of the plan too much? Open Europe’s Raoul Ruparel answers these questions and more.
22 January 2015
The key points and details of the announcement can be found here, so we won’t rehash them. But there are plenty of interesting points to consider.
As a package, the total amount is higher than most expected as are the monthly flow of purchases. This will buoy markets. The programme may help instil a more positive mindset and lower the exchange rate to boost exports. However, this is unlikely to be lasting. In the end, the ball remains firmly in the court of national Eurozone leaders. As Draghi himself suggested, unless they can significantly improve the business climate and enhance structural reforms (in some of the largest members) as well as tackling the institutional problems, the impact of ECB QE could well be limited.