The ECB’s Governing Council deserves credit for meeting the demandingly high level of expectations with last week’s announcement of a quantitative easing programme worth at least €1trn. The size and open-endedness of the programme appears to have trumped the lack of risk-sharing.
But it remains to be seen whether the ECB will ultimately be as bold as the US Federal Reserve and the Bank of England needed to be in order to make a material difference to their economies. And there are good reasons why QE might be less effective in the euro-zone than it was elsewhere. For now, then, we’re not minded to alter our forecasts for the currency union’s economy.
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