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That’s All There Is: Draghi Drags His Heels And Says ECB Isn’t Likely To Cut Interest Rates Further

This is a syndicated repost courtesy of Confounded Interest. To view original, click here. Reposted with permission.

Mario Draghi tried to reel back his stimulus torpedo by saying further stimulus isn’t likely. Investors responded by singing “Is that all there is?”

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({Bloomberg) –0 The European Central Bank can cut interest rates further but isn’t likely to, Mario Draghi said after unveiling stimulus on Thursday that brought borrowing costs to record lows, expanded asset purchases and offered a borrowing subsidy to lenders.

“It’s a fairly long list of measures, and each one of them is very significant and devised to have the maximum impact in boosting the economy and the return to price stability — we have shown we are not short of ammunition,” the ECB president told reporters in Frankfurt after a two-day meeting of the Governing Council. “From today’s perspective, we don’t anticipate it will be necessary to reduce rates further.”

European 10 year sovereign yields reversed from being down in the morning to being up in the afternoon.

European equities deflated like a day old Burger King Whopper after Draghi’s admission that “that’s all there is.”

The USD/EUR cross rose in the morning, but fell when Draghi admitted it would NOT be “Sugar in the morning, sugar in the evening, and sugar at suppertime.”

No investors, Mario isn’t singing “Sugartime.” At least, not until this fails.


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