Panmure’s economist, Simon French’s thoughts on EU QE

 Eurozone QE : Super Mario does his part but will Angela, Francois and Matteo do theirs?
Senior UK Economist – Simon French +44 (0)20 7886 2753
The European Central Bank has announced its intention to inject an additional €1.2trn of liquidity into Eurozone capital markets over the next 18 months. We applaud the ECB Governing Council for making this intervention but in isolation it will be insufficient to restore confidence in the Eurozone economy and return inflation towards its 2% target. Lower borrowing costs and a weaker Euro will help stimulate Eurozone demand but without coordinated support from looser fiscal policy and structural reforms the impact on growth is likely to be limited in the face of unfavorable demographic trends as well as labour and regulatory market rigidities.
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