European Central Bank: Draghi suggests that the decisions in December – business week

20. October 2016, updated today, 13:59 PM

the European Open of Central Bank the monetary floodgates even further or closes it gradually? Clarity over the course of the Central Bank is likely to give it until the end of the year.

The European Central Bank remains on Anti-crisis course: she looks for the time being, no reason to change its ultra-loose monetary policy. The Council had not discussed in its meeting about a gradual phasing out of the multi-billion dollar bond purchases have, said ECB President Mario Draghi in Frankfurt on Thursday. But also about an expansion of the programme had not been spoken. Clarity is likely to bring to the December meeting. “Then we will say what we will do in the next few months.”

In December, the ECB presents its latest economic and inflation forecasts. Should it be necessary, will use the Central Bank to use all available instruments, reiterated Draghi. At the same time, the Central Bank President stressed: “No one wants purchases to an abrupt end of the bond.” Last speculation on a forseeable end to the flood of money had caused some unrest among investors.

in March of 2015 if the Central Bank buys government bonds and other securities on a large scale. 80 billion euros is currently allocated on a monthly basis, overall, it should be of 1.74 trillion euros. The program is scheduled to run until at least the end of March 2017. Since June, corporate bonds are on the shopping list.

the ECB’s monetary policy: Loads shed as a result of low interest rates

• passbook and Co

  In Germany, the popular forms of savings such as day – and hardly anything else. The low Inflation the negative effects of low interest rates, however, stresses the President of the ECB Mario Draghi. Currently, the return on spent minus Inflation is higher than the average for the 1990s. To had “the time you higher interest rates on Savings accounts, but at the same time, usually in Inflation, and all ate,” said Draghi in a recent Interview. In may, the consumer prices in Germany according to preliminary calculations, just 0.1 percent above the previous year’s level.

  status: 07.06.2016

• penalty interest and Bank charges

  financial institutions have to pay penalty interest when they Park money at the ECB. For the average private customer penalty interest are not have been an issue. You’ll do “everything to protect the private savers negative interest rates in Parts at the expense of the own income situation”, – said recently the head of the German savings banks Association, Georg fahrenschon. If the current low interest rate phase continued but for a long time, would not be able to keep the savings banks, the customers, ultimately, in front of it. In addition, banks could be forced according to the President of the Federal Association of German people’s banks and Raiffeisen banks (BVR) Uwe Fröhlich, to turn on the toll-bolt: “Everyone must consider his own, as he anarbeitet about terms and conditions-design against yield losses, which are, without a doubt.”

• retirement

  life insurers find it harder and harder for the high Commitments of the past. The result is that the rate of return on the pension scheme-classic sinks for quite some time. Also occupational pensions suffer, companies need to put back because of the interest for more and more money for the pension liabilities to melt. Many companies promise, for new hires, therefore, no concrete achievements, but to say only a certain amount per month in pension funds. The interest rate risk borne by future pensioners.

However, some papers are gradually scarce, which can be bought by the ECB only to self-imposed criteria. Currently, you may not acquire bonds whose interest rates below the Deposit rate of minus 0.4 percent. In addition, it has established to buy a maximum of 33 percent of the issued security. In the case of an expansion of the flood of money the ECB is likely to come in conflict with the rules.

“If the ECB purchases the bonds, as we expected, nine months, you can find an estimated in the early summer of 2017, when the current rules no longer have enough purchasing eligible government bonds”, the Commerzbank. Therefore, should the ECB in December, the conditions of purchase change

The ECB left its key interest rate in the Euro area, to the commercial banks of fresh Central Bank to get more money can, as expected, at a record low of zero percent. The Penalty rate for banks from 0.4 per cent do not groped. Banks have to pay these if you are Parking excess money at the Central Bank.

He was not elected, any government accountable, but he’s risking all of our money. For the past five years, the ECB President is Mario Draghi the most powerful man in Europe. Close-up of a conviction offender.

With the measures to boost the ECB, the economic activity and Inflation in the Euro area push. Although Inflation rose in September to the highest level since October 2014. The Rate is 0.4 percent but far from the price the ECB’s target of just under two per cent.

in the long term, low or even falling prices are considered a risk to the economy: businesses and consumers may defer investments because they expect that it will be even cheaper.

the ECB’s monetary policy: relief through low interest

• credits

  consumers can save on loans, whether for the TV or for your own four walls. House builders will be able to borrow at historically favourable terms. According to the Bank Association BdB mortgage loan with ten years fixed interest rate are currently have effective interest rates of an average of about 1.4 percent. In 2007, they were still more than five percent.

• MRP interest

  Cheaper it is to overdraw your own account. Five years ago, the overdraft interest rates were, according to the financial advice FMH in the section even in the case of 11,26%. Meanwhile, there are an average of 9,51%.

• shareholders

  Since years of cheap Central Bank money, the Central fuel for the stock markets. Shareholders can benefit from rising rates. Finally, the more publicly shy German ventured more in the stock market. Just 9,01 million people had, according to the German share Institute in the past year, the shares and/or shares in a Fund, the highest level since 2012.

• The state

  With the issuance of bonds, the public sector financed – in addition to tax revenues – a large part of their expenditure. On Monday, the so-called current yield, which is an average measure of the “interest” of government securities with a maturity of three to 30 years, fell in Germany for the first time since the founding of the Federal Republic in the negative range. The Federal “earned” in such a Situation, therefore, of his own Debt, instead of paying the creditors, the purchasers of the bonds – interest.

  Stand: 7. June 2016

Draghi expects the inflation rate attracts progressively, mainly due to increasing energy prices. The economic performance in the Euro area is expected to increase moderately but steadily. The resistance to economic uncertainties had increased.

The ultra-loose monetary policy of the ECB is especially controversial in Germany. You savers. Critics also fear a decline in the willingness to reform the policy.