ECB’s Visco Says Euro Decline `Stronger Than We Had Expected’
2015-03-14 13:07:03.252 GMT
By Alessandro Speciale
(Bloomberg) -- ECB QE risks include “overshooting” as
“it is beyond doubt that the strength of the exchange rate
decline is larger than we had expected,” Bank of Italy’s
Governor Ignazio Visco says at Ambrosetti Forum in Cernobbio,
Italy.
* Euro decline possibly not only connected to QE
* Same also valid for bonds
* Limiting risk-sharing in ECB QE was “an error in the
perspective of the European Union but was justified with the
absence of a fiscal union and so there were risks on that
side”
* “I think this can only lead toward an improvement of the
European institution”
* Credit cost to fall on QE but “not in an extraordinary
way”
* Says QE will lead to aggregate demand growth of 1 percentage
point, according to Bank of Italy study
* Buying govt bonds is “most obvious instrument to create
money today”
* Before QE, “we had surely observed recently a grave risk of
price stagnation and decline, what we can define a deflation
risk”
* “There is no such thing as good deflation”
* QE reduces macroeconomic uncertainty, “improves the context
for structural reforms”
* “We cannot have interest rates at zero forever or for an
ultra-extended period, thus we need to try to return as fast
as possible on a path of inflation toward 2 percent”
* At same even in Cernobbio, Italy Finance Minister Pier Carlo
Padoan says “macroeconomic window of opportunity” is
“larger than thought a few weeks ago”
* Padoan says growth could be short-lived if govt doesn’t use
opportunity to increase medium-term growth prospects
* Padoan says favorable macro conditions mustn’t be seen as
“justifying weaker incentive to do reforms”
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Alessandro Speciale in Frankfurt at +49-69-9204-1201 or
aspeciale@bloomberg.net
To contact the editor responsible for this story:
Fergal O’Brien at +44-20-3525-7152 or
fobrien@bloomberg.net
2015-03-14 13:07:03.252 GMT
By Alessandro Speciale
(Bloomberg) -- ECB QE risks include “overshooting” as
“it is beyond doubt that the strength of the exchange rate
decline is larger than we had expected,” Bank of Italy’s
Governor Ignazio Visco says at Ambrosetti Forum in Cernobbio,
Italy.
* Euro decline possibly not only connected to QE
* Same also valid for bonds
* Limiting risk-sharing in ECB QE was “an error in the
perspective of the European Union but was justified with the
absence of a fiscal union and so there were risks on that
side”
* “I think this can only lead toward an improvement of the
European institution”
* Credit cost to fall on QE but “not in an extraordinary
way”
* Says QE will lead to aggregate demand growth of 1 percentage
point, according to Bank of Italy study
* Buying govt bonds is “most obvious instrument to create
money today”
* Before QE, “we had surely observed recently a grave risk of
price stagnation and decline, what we can define a deflation
risk”
* “There is no such thing as good deflation”
* QE reduces macroeconomic uncertainty, “improves the context
for structural reforms”
* “We cannot have interest rates at zero forever or for an
ultra-extended period, thus we need to try to return as fast
as possible on a path of inflation toward 2 percent”
* At same even in Cernobbio, Italy Finance Minister Pier Carlo
Padoan says “macroeconomic window of opportunity” is
“larger than thought a few weeks ago”
* Padoan says growth could be short-lived if govt doesn’t use
opportunity to increase medium-term growth prospects
* Padoan says favorable macro conditions mustn’t be seen as
“justifying weaker incentive to do reforms”
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Alessandro Speciale in Frankfurt at +49-69-9204-1201 or
aspeciale@bloomberg.net
To contact the editor responsible for this story:
Fergal O’Brien at +44-20-3525-7152 or
fobrien@bloomberg.net