European Central Bank (ECB)

Draghi weighs in on Fed independence debate

European Central Bank President Mario Draghi waits to address the committee on Economic and Monetary Affairs at the European Parliament in Brussels on January 28, 2019
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European Central Bank President Mario Draghi said over the weekend he was concerned about central bank independence in the US, according to media reports.

US President Donald Trump has repeatedly criticised the Federal Reserve's monetary policy in recent months.

Presidents generally avoid criticising the Fed publicly, for fear of politicising the institution and undermining confidence in its decisions.

“I’m certainly worried about central bank independence in other countries, especially... in the most important jurisdiction in the world,” Draghi was quoted as saying.

Draghi speaks

Mario Draghi
AFP

Mario Draghi, president of the European Central Bank, has been speaking at a conference in Frankfurt.

Earlier this month, the ECB said interest rates in the eurozone will not rise until next year at the earliest amid evidence of a slowdown in the 19 countries using the single currency.

"Just as we did at our March meeting, we would ensure that monetary policy continues to accompany the economy by adjusting our rate forward guidance to reflect the new inflation outlook," he said.

More on ECB minutes

The account of the ECB’s last meeting confirms that the governing council had become more concerned about the outlook for the eurozone economy by January, and that the ECB is preparing to announce more longer-term refinancing operations within the coming months. But it sheds no further light on other possible policy moves in the event that the current slowdown proves deeper or longer-lasting than expected.

Andrew KenninghamChief Europe Economist, Capital Economics

ECB minutes

ECB
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The European Central Bank took a gloomier outlook on growth, according to the minutes of its January meeting.

"The risks surrounding the euro area growth outlook had moved to the downside, as the persistence of uncertainties related to geopolitical factors and the threat of protectionism, vulnerabilities in emerging markets and financial market volatility was increasingly weighing on economic sentiment," the minutes said.

They also appear to show the central bank for the eurozone could be considering offering banks long-term loans to ensure they can keep lending during an economic downturn.

"A number of remarks were made regarding available monetary policy tools in the domain of longer-term liquidity provision. Any potential new operations should reflect the monetary policy objectives to be achieved. While any decisions in this respect should not be taken too hastily, the technical analyses required to prepare policy options for future liquidity operations needed to proceed swiftly," the minutes said.

Mario Draghi

Andrew Walker

BBC World Service economics correspondent

European Central Bank chief Mario Draghi is more cautious about eurozone growth - likely to push rate rises into the distance.

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BreakingECB keeps rates unchanged

The European Central Bank kept rates unchanged. It will hold rates at least through the summer, it said.

ECB steps in to help Italian bank

The European Central Bank has appointed three temporary administrators to take charge of Italy's Carige in a bid to save the struggling lender after it failed to raise capital late last year.

Several members of Carige's board, including the chief executive, resigned on Wednesday. The bank had tried, and failed, to raise about €400m (£360m).

"The ECB appointed Fabio Innocenzi, Pietro Modiano and Raffaele Lener as temporary administrators... tasked with safeguarding the stability of (Carige)," the ECB said in a press release.

Eurozone inflation ticks up

ECB HQ
Reuters

Eurozone inflation rose to 2.2% in October, moving further away from the European Central Bank's target rate, as unemployment remained stable.

The rise from 2.1% in September was driven by higher energy prices and marks another step up from the ECB's aim of near or lower than 2%.