Eurozone Deflation: Draghi Doubles Down on Bullish Message at Davos

In the Swiss mountain village of Davos, a group of the rich and powerful meet annually for the World Economic Forum. This year's attendees included over 40 world leaders and 1,074 chief executives or chairmen of companies.

European Central Bank President Mario Draghi spoke at this year's gathering and reiterated his belief that the ECB can pull the Eurozone out of deflation.

Here's an excerpt from a Jan. 22 Independent article:

Mario Draghi, the President of the European Central Bank, has stressed that he has the necessary "instruments" to pull the eurozone out of the grip of deflation and that the Governing Council is now united in its willingness to use them.

Speaking at the World Economic Forum in Davos Mr Draghi doubled down on the bullish message from his Frankfurt press conference [Jan. 21], telling delegates that the ECB would be successful in bringing inflation in the single currency back to the target of just below 2 per cent.

"We've plenty of instruments and determination and willingness of the Governing Council to act and deploy these instruments" he said. ...

Eurozone inflation was 0.2 per cent in December, up from 0.1 per cent the previous month. Excluding energy and food, consumer prices were just 0.8 per cent, flat on November, and still well below the ECB's target.

Mr. Draghi said he was confident growth in the Eurozone was picking up but that "on the inflation side things are different", underlining the need for more stimulus on top of the ECB's EUR1.1 trillion quantitative easing programme.

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