ECB Kocher says Europe economy shows momentum, threats price stability
Martin Kocher, the Governor of the Austrian National Bank and member of the European Central Bank (ECB), said in an interview with Bloomberg that Europe’s economy shows more momentum.
At the Jackson Hole Symposium, he said that the economy has been more resilient than expected and that threats lean towards price stability.
Key highlights:
Important how long-lived inflation proves to be.
There are threats to price stability.
There's alertness and no complacency.
The economy was more resilient than expected.
The European economy is showing more momentum now.
Euro Price Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.60% | 0.46% | 0.46% | 0.37% | 0.50% | 0.69% | 0.64% | |
| EUR | -0.60% | -0.13% | -0.11% | -0.27% | -0.10% | 0.11% | 0.04% | |
| GBP | -0.46% | 0.13% | 0.00% | -0.14% | 0.04% | 0.24% | 0.18% | |
| JPY | -0.46% | 0.11% | 0.00% | -0.10% | 0.03% | 0.22% | 0.17% | |
| CAD | -0.37% | 0.27% | 0.14% | 0.10% | 0.13% | 0.32% | 0.27% | |
| AUD | -0.50% | 0.10% | -0.04% | -0.03% | -0.13% | 0.20% | 0.16% | |
| NZD | -0.69% | -0.11% | -0.24% | -0.22% | -0.32% | -0.20% | -0.05% | |
| CHF | -0.64% | -0.04% | -0.18% | -0.17% | -0.27% | -0.16% | 0.05% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
ECB FAQs
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.
Nothing in this material constitutes investment advice, personal recommendation, investment research, an offer, or a solicitation to buy or sell any financial instrument. The content has been prepared without consideration of your individual investment objectives, financial situation, or needs, and should not be treated as such.
Past performance is not a reliable indicator of future performance and/or results. Forward-looking scenarios or forecasts are not a guarantee of future performance. Actual results may differ materially from those anticipated.
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