Euro crisis – Draghi speaks the weak euro – Frankfurter Rundschau

Euro crisis – Draghi speaks the weak euro – Frankfurter Rundschau

02 January 2015

As weak as since four years: the Euro.Foto: REUTERS

The euro falls to its lowest level in more than four years , Was triggered by the re-euro plummeting again ECB President Mario Draghi. With the controversial purchase of government bonds he wants to push yields.

USA holidays are more expensive. Save when refueling consumer less as it actually suggests the decline in oil prices. For the weak euro provides. To start to the year, the euro fell against the dollar again in value and slumped to its lowest level in four and a half years

. Euro and dollar soon the same amount of value

Got German, French or Italian a few months ago for a euro still almost $ 1.40, so there are hardly more than 1.20 dollars. Even parity, are accurate in euro and dollar equal value, experts – such as the Deutsche Bank – already ahead

was triggered by the re-euro plummeting again Mario Draghi. President of the European Central Bank (ECB). While those in the US thanks to the local economic recovery initiate the end of the low interest rates, Draghi proposes a the opposite direction. With the controversial purchase of government bonds he wants to reduce the returns on this important financial market. Ran Preparations for Draghi told the “Handelsblatt”.

These few words were enough to offset the foreign exchange markets in excitement. The statement made clear once again that Draghi is serious about his announcement to smuggle the dangerously low inflation in the euro area from near the zero line high. Consequently, as higher interest rates investments in the US are more lucrative in the Euro-zone, they become less attractive. So that capital flows to the United States. The dollar enhances, the euro.

This need not be bad for the monetary union. On The Contrary. The German industry is happy with the devaluation as a belated Christmas season. For every dollar that it occupies in the global markets, they now get more euros.

If the new Euro-slump triggered: ECB President Mario Draghi.Foto: REUTERS

So she can either reduce prices abroad, which strengthens the competitiveness of, or increase profit margins. Or she does both a bit. The companies in the Euro-crisis countries benefit from it – this helps them in the pursuit of international competitiveness

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No hope for a speedy turnaround

Draghi but still aims at a second effect. For Suppliers from China, the US and Latin America, costing no more going on when they receive less domestic currency for their Euro. You need to increase the prices of their deliveries to Europe. Thus, the weaker the euro, the more expensive the import. Of these, the ECB hoped for support in the fight against the threat of deflation, the euro zone would move in a downward spiral in which falling prices. This risk is in any event higher than six months ago, Draghi said. Therefore, it makes no hope for a speedy turnaround. “If we could get the idea to raise interest rates, then the crisis would get worse. The stability would suffer – and that would harm investors and savers even more “

The massive criticism is always practiced mainly from Germany at the rate of the ECB, Draghi countered in the. “Handelsblatt” interview with harsh words. For some time he is annoyed by the voices of the largest euro country. He fulfilled his duty, said the Italian. “I believe that duty is not a national characteristic of the Germans.”