Davos 2014: ECB's Draghi sees 'dramatic improvement' in eurozone recovery

European Central Bank President Mario Draghi at the World Economic Forum in Davos, Switzerland Mario Draghi has previously said he would do whatever it takes to save the euro

The head of the European Central Bank, Mario Draghi, says there has been a "dramatic improvement" in the eurozone recovery over the past two years.

Speaking at a forum in Davos he said: "Risks have decreased across the board both for core eurozone countries and the periphery".

Mr Draghi said that so far the recovery had been driven by exports, but demand was picking up with domestic consumers.

However he warned that the recovery was still fragile and uneven.

On the subject of inflation, Mr Draghi said he was confident that in the medium term the eurozone would achieve its 2% target.

'Underestimated commitment'

Currently, eurozone inflation stands at 0.8% - and there are fears that it could fall further - or even turn negative. That is known as deflation and means prices would actually begin to fall.

Mr Draghi reassured the audience that eurozone policymakers were watching the inflation rate carefully, and he admitted that the "longer this period lasts - the higher the risk" to the recovery.

During his speech, Mr Draghi said he thought the cause of low inflation lies in the fact that the region has been emerging from a banking crisis.

He noted that the inflation rate was not much lower than the rate in the US.

Mr Draghi also said that the European Central Bank (ECB) could not claim all the credit for the eurozone recovery, explaining that the decision by European leaders to create a banking union had played a large part.

"Markets vastly underestimated the amount of political commitment," to a recovery, he said.

European leaders recently agreed to create a common fund that would help the process of closing down a failing bank in the future.

The plan would involve European banks putting 55bn euros ($75bn; £46bn) into a fund over 10 years, to avoid using public money for a bank bailout.

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BBC Business Live

  1.  
    10:08: Eurozone inflation

    A preliminary estimate for the level of inflation (that's the rise in the prices of everyday goods and services) in Europe shows a drop to 0.3% in November - down from 0.4% the month before. Falling oil prices accounted for much of that drop, but the slow creep toward deflation will add further pressure on the European Central Bank, which targets inflation of 2%.

     
  2.  
    10:00: Cameron immigration speech

    "Put simply, our job is to educate and train up our youth, so we are less reliant on immigration to fill our skills gap," says the PM. "And any politician who doesn't have a serious plan for welfare and education, has no sensible long-term plan for controlling immigration."

     
  3.  
    09:58: Cameron immigration speech

    "For the sake of British jobs, British livelihoods and British opportunities we must fight this dangerous and misguided view that our nation can withdraw from the world and somehow all will be well."

     
  4.  
    09:58: Cameron immigration speech
    Cameron

    "We are Great Britain because of immigration, not in spite of it," says David Cameron in his opening salvo. "Throughout our long history, we have always looked outward, not inward. We have used the seas that surround our shores not to cut ourselves off from the world, but to reach out to it - to carry our trade to the four corners of the earth. And with that trade has come people, companies, jobs and investment."

     
  5.  
    09:44: Black Friday

    John Lewis says it is currently selling one Nutribullet every 30 seconds. For the uninitiated, that's a food processor, or juicer, if you prefer.

     
  6.  
    09:28: Italian jobs

    Unemployment in Italy has reached a record high of 13.2%, according to official figures for the month of October. It's the largest percentage since figures were first collected in 1977. Even worse news for 15-24 year olds in the country - 43.3% were unemployed last month.

     
  7.  
    Black Friday Sgt Paul Marshall, Kingston Police

    tweets: "Even on #BlackFriday shoving people to the floor so you can get £20 off a Coffee Maker is still an assault."

     
  8.  
    09:12: Markets update

    European markets are lower this morning on the back of falling oil prices, which are nearing $70 a barrel. They've not been that low in four years.

    • The FTSE 100 is lower by 0.74% at 6673
    • Germany's Dax is lower by 0.47% 9928
    • France's Cac-40 is lower by 0.53% at 4359
     
  9.  
    09:05: House prices
    Graph showing house price growth since November 2004

    The annual house price has been falling since June, when growth peaked at 11.4%. Now it's only 8.5% higher than this time last year. It's worth remembering that house price growth is coming off a low base as well. Property values (that's the average for the whole of the UK) only began to rise in the summer of 2013, as the effects of the Funding for Lending and Help to Buy schemes began to be felt.

     
  10.  
    Black Friday Kadhim Shubber, reporter at the FT
    Asda

    tweets: "Unleash the capitalism #BlackFriday" (Click through for the full Vine video)

     
  11.  
    Black Friday Bryan Roberts, director at Kantar Retail
    Asda

    There are cheerleaders in Asda. Really. Bryan tweets: "Cheerleaders. This is my job. Honest."

     
  12.  
    08:24: Building Lego
    Malaysia Lego

    UK theme park operator Merlin Entertainments has announced it will open a new Legoland... in South Korea. The attraction is expected to open its doors in Chuncheon, Gangwon Province by 2017. There is already a Legoland in Malaysia, and the firm plans to build one in Dubai too.

     
  13.  
    Black Friday Bryan Roberts, director at Kantar Retail

    tweets: "6 minutes ago, this was a massive pile of TVs"

    TVs
     
  14.  
    Black Friday Sarah Butler, The Guardian

    tweets: "Crazy queues at Asda, but all calm and very British queue in place... So far"

    Black Friday
     
  15.  
    08:10: Black Friday

    Richard Main, a reporter at BBC London 94.9, emails in: "More than 150 people are now queuing to get into Asda on Edgware Road, in the hope of bagging a Black Friday deal. Police were called to the store in the early hours of the morning to control crowds. The current queue now stretches the length of the car park and is being penned in by a wall of shopping trolleys."

     
  16.  
    Black Friday Greater Manchester Police

    tweet: "At least two people arrested at #BlackFriday sales events already this morning. Keep calm people!"

     
  17.  
    08:02: Black Friday
    People sort through boxes of shoes in Macy"s

    A bit of Friday fun now. We want your best/worst Black Friday deals. What's the most ridiculous sale item you've seen or bought? What's be best/worst discount you've seen? Have you seen punch-ups over the last sale item or is everyone queuing politely? Send your stories/pictures/experiences/views of Black Friday to bizlivepage@bbc.co.uk or tweet @bbcbusiness.

     
  18.  
    07:45: Betting campaign BBC Radio 4
    Betting terminal

    The maximum stake on gambling machines known as "fixed odd betting terminals" is £100. Many think that's outrageous, as it's possible to lose an awful lot of money in a very short time. Now more than 90 councils in Britain are campaigning to have that reduced dramatically - to £2. Sir Robin Wales, the mayor of Newham in London, tells Today that gambling firms deliberately target poorer areas.

     
  19.  
    07:34: House prices
    Graph showing the average house price to average earnings ratio

    One thing to note in the latest Nationwide figures is the price-to-earnings ratio, which has tailed off ever so slightly. This measures how high house prices are, relative to the average person's salary. The higher the ratio rises, the less affordable housing becomes. Since WW2, each time average house prices have reached six times average earnings, there as been a crash.

     
  20.  
    07:22: House prices

    The price of an average house in the UK rose by 0.3% in November to £189,388, according to the latest figures from Nationwide. Overall, however, the growth in house prices slowed to 8.5%, when compared to November of last year. It was 9% in October.

     
  21.  
    07:12: Energy penalties
    Drax

    "We are deeply disappointed with the magnitude of the fine," said Drax boss Dorothy Thompson. But Ofgem's Sarah Harrison says the firm "missed its target by a clear margin" and accuses it of "disadvantaging several thousand households in some of the most deprived areas in Britain".

     
  22.  
    07:06: Energy penalties

    Another generation firm, Intergen, is also facing an £11m payout. The companies failed to meet targets to insulate homes under two energy efficiency schemes that ran until the end of 2012. The failings meant that households did not receive the energy saving measures, which would have helped to reduce their bills.

     
  23.  
    07:00: Energy penalties

    The power generation company Drax, based in North Yorkshire, has been hit with a £28m financial penalty after failing to meet targets to provide energy efficiency measures to homes. It's the largest penalty ever handed down by the energy regulator Ofgem.

     
  24.  
    06:58: Black Friday Radio 5 live

    Ms Burge tells Wake Up to Money that over the last couple of years retailers and consumers have "engaged in a game of chicken". Consumers have started holding out on retailers, she says, in the knowledge that the closer they get to Christmas, the more likely they will be to get a deal as retailers start discounting.

     
  25.  
    06:45: Tech terms

    More from Andrew Miller on tech firms' terms and conditions. "They are often laughably long and written in the kind of legalese you need a law degree from the USA to understand," says the Labour MP for Ellesmere Port and Neston.

     
  26.  
    Via Twitter NASA
    Pic of a star being sucked into a black hole

    If you don't really get all this Black Friday stuff, it's not really your bag or the fact that the spirit of Christmas has been lost in worship to Mammon is getting you down, NASA has a solution for you. It tweets: "It's #BlackFriday, but for us, it's the 2nd annual #BlackHoleFriday. Today, we'll post pics & info about black holes".

     
  27.  
    06:32: Tech terms

    The chairman of the Science and Technology Committee, Andrew Miller, told the BBC: "I simply cannot say to a constituent of mine I know with 100% certainty what they're doing with that data because frankly I don't understand those legal terms and conditions".

     
  28.  
    06:26: Tech terms

    MPs are calling for social networking companies, such as Facebook and Twitter, to explain more clearly to users what they do with information collected about them. The Commons Science Committee says the firms' terms and conditions agreements are far too long and complex for any reasonable person to read.

     
  29.  
    Via Twitter Alistair Charlton, senior technology reporter at IBTimes UK
    Black Friday

    tweets: "Tesco website down, Currys website down, shopping chaos caught on video. It's #BlackFriday."

     
  30.  
    06:12: Black Friday Radio 5 live

    Natalie Burge, retail analyst at Planet Retail, says Black Friday is a "really strange phenomenon, but it makes sense in the US" because it comes after a public holiday - a bit like Boxing Day. Whereas in the UK it's just another day. Black Friday falls on "the day of the last pay cheque before Christmas" so retailers are spotting an opportunity to get consumers to part with their hard earned cash, she adds.

     
  31.  
    06:04: Black Friday

    Shareholders among you may still recoil at the term "Black Friday" - the name given to the stock market crash of October 13, 1989. But fear not, in the shopping context, the name has no such negative connotations. It's called Black Friday because many shops make enough money to put them "in the black" for the year, apparently.

     
  32.  
    06:00: Black Friday
    Black Friday

    Police were called to a number of supermarkets across the UK last night, amid concern about the size of crowds waiting for the doors to open on what's become one of the busiest shopping days of the year. Increasing numbers of British retailers are adopting the American tradition of reducing some of their prices for Black Friday - the day after Thanksgiving. Some websites are already reported to be struggling to cope with demand.

     
  33.  
    06:00: Matthew West, Business Reporter

    As always, you can get in touch by emailing bizlivepage@bbc.co.uk or tweeting @BBCBusiness.

     
  34.  
    06:00: Joe Miller Business Reporter

    Good morning. In a long-awaited speech later, David Cameron will call for major changes to the benefits that can be claimed by European Union migrants. He'll say they should have to wait four years before they can claim in-work benefits such as tax credits, or be eligible for social housing. We'll bring you more on that, and the rest of the business news throughout the morning.

     

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