Senior Economics Correspondent, Germany
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May 22, 2014

ECB to ease stress test for Franco-Belgian Dexia

DUBLIN/FRANKFURT, May 22 (Reuters) – ECB officials agreed on
Thursday that Franco-Belgian bank Dexia would not have
to prove it could withstand a financial crisis in a Europe-wide
stress test, reducing the chances of it needing further state
aid, sources familiar with the talks said.

Belgium and France have already pumped nearly 12 billion
euros ($16.4 billion) into Brussels-based Dexia since the
financial crisis, taking control of it in the process, and are
keen not to put in more to a loss-making institution that is
being wound down.

Apr 29, 2014

ECB fails to fully offset bond buys again as money markets tighten

FRANKFURT (Reuters) – A fall in euro zone lending, weaker-than-expected German inflation and signs of tightening in money markets compounded the European Central Bank’s policy conundrum on Tuesday as it weighs up whether to act next week.

ECB President Mario Draghi last week identified a weakening of the euro zone inflation outlook and tensions in short-term money markets as potential triggers for fresh policy action.

Apr 29, 2014

Warning signals flash for ECB ahead of May meeting

FRANKFURT (Reuters) – A fall in euro zone lending, weaker-than-expected German inflation and signs of tightening in money markets compounded the European Central Bank’s policy conundrum on Tuesday as it weighs up whether to act next week.

ECB President Mario Draghi last week identified a weakening of the euro zone inflation outlook and tensions in short-term money markets as potential triggers for fresh policy action.

Apr 28, 2014

IMF urges ECB to do all it can to tackle low inflation

FRANKFURT, April 28 (Reuters) – The European Central Bank
should do “everything it can” to tackle low growth and inflation
but euro zone governments must also shape up their economies, a
senior International Monetary Fund official said on Monday.

Jose Vinals, director of the IMF’s monetary and capital
markets department, said a multi-pronged policy approach was
needed to buoy the 18-country euro zone.

Apr 17, 2014

Insight – ECB hardliner Weidmann comes in from the cold as deflation threatens

FRANKFURT (Reuters) – As recently as last November, Jens Weidmann steadfastly opposed any move by the European Central Bank to print money to buy assets and buoy the euro zone economy. No longer.

The Bundesbank chief, known for his hardline stances at the ECB and as head of the German central bank, is now ready to support such quantitative easing (QE) if he and his ECB colleagues deem it necessary.

Apr 17, 2014

ECB hardliner Weidmann comes in from the cold as deflation threatens

FRANKFURT, April 17 (Reuters) – As recently as last
November, Jens Weidmann steadfastly opposed any move by the
European Central Bank to print money to buy assets and buoy the
euro zone economy. No longer.

The Bundesbank chief, known for his hardline stances at the
ECB and as head of the German central bank, is now ready to
support such quantitative easing (QE) if he and his ECB
colleagues deem it necessary.

Apr 14, 2014

Draghi puts euro strength at centre of ECB policy debate

FRANKFURT/LONDON, April 14 (Reuters) – By expressing concern
at the euro’s strength, European Central Bank President Mario
Draghi is trying to talk down the currency and avoid taking
fresh action to tackle worryingly low inflation – but financial
markets will test his resolve.

Draghi identified the currency’s strength at the weekend as
a possible trigger for the ECB to ease policy, saying in
Washington: “The strengthening of the exchange rate would
require further monetary policy accommodation.”

Apr 11, 2014

Draghi takes slow road to QE with packaged-debt push

FRANKFURT (Reuters) – The European Central Bank is mulling creative measures to stave off deflation but one of them, revamping a market that was at the heart of the financial crisis, will take time with no guarantee it will take off.

It is scrambling to boost Europe’s market for securitized assets – those backed by loans.

Apr 8, 2014

Bundesbank says ‘low-flation’ high on agenda at IMF meeting

FRANKFURT (Reuters) – Persistently low inflation in the euro zone and the resulting risks for the global economy will feature high on the agenda of the spring meetings of the International Monetary Fund and the G20, Germany’s Bundesbank said on Tuesday.

The European Central Bank has resisted IMF calls to ease monetary policy further to combat the risk of so-called “low-flation”, which the IMF fears could drag on global growth in the short term, along with geopolitical tensions in places like Ukraine, and market volatility.

Mar 14, 2014

Draghi holds course in face of deflation threat

FRANKFURT/WASHINGTON (Reuters) – Meeting students at the University of Amsterdam in April last year, European Central Bank President Mario Draghi extolled the virtues of courage, recalling a story his father had told him:

“In between the wars, he saw an inscription on a German monument, a German statue saying that ‘if you lose your money you’ve lost nothing, because with a good business you will take it back; if you lose honor, you’ve lost a lot, but with good heroic action you can get it back; but if you’ve lost courage, you’ve lost everything.’”

    • About Paul

      "I lead our economic news file from Berlin, where we report on the performance of the German economy – Europe’s largest – and economic policy: everything from financial regulation to dealing with the euro zone debt crisis. I previously reported on political and economic news from Paris and on earlier assignments worked in Frankfurt, Vienna and London."
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