ECB: start Qe from March 9 Dragons, “Shooting will be ‘more’ strong ‘- AGI – Agenzia Journalistic Italy

21:03 March 5, 2015

(AGI) – Rome, March 5 – Partira ‘Monday’ next, March 9, the program ‘quantitative easing’ fielded by the ECB to return inflation to the ranks and stimulate the economy of an eurozone whose recovery, as said today the president of the Eurotower Mario Draghi , appears stronger.

“The latest economic data show some further improvements of the economy at the beginning of ‘ year, “said Draghi,” looking ahead, we expect the economic recovery will widen and strengthen gradually. ”

Frankfurt has in fact revised raises forecast on GDP growth of the euro, now expected to expand by 1.5% in 2015 (+ 1% estimated December), 1.9% in 2016 and 2.1% in 2017.

Inflation , however, is expected to return to rise later this year, where the risks to growth, while remaining on the downside, were down. To this cloudy helped the expansionary monetary policy of the ECB, Draghi stressed that “is already ‘producing significant positive effects”, such as, for example, lowering financing costs, both for states that for individuals, in starting from relaxing credit conditions for households and businesses. But monetary policy can not ‘do everything alone, added the number one Eurotower, which then reiterated the invitation to governments to implement structural reforms in a “rapid, credible and effective.”

The ‘quantitative easing’ provides for the purchase on the secondary market of debt securities of eurozone public institutions to the tune of 60 billion Euros per month. The purchases will mainly government bonds but also involve issues of supranational institutions present in the Eurozone (as bailout funds EFSF and ESM).

The program will last ‘until at least September 2016 but potra’ be extended indefinitely until ‘will not be’ achieved the goal of bringing inflation to a level below but close to 2%.
The minimum amount of the quantitative easing program will be ‘thus amounted to 1,140 billion euro, 12% of which will be’ invested in securities of supranational institutions (EFSF, EIB, etc).

The ECB may ‘buy government bonds that are considered’ investment grade ‘(ie, with a rating above the level of’ junk ‘) by at least one ratings agency. Exemptions are provided for those countries that are following a plan for international assistance. Therefore Greece remain ‘out of the program until’ the ‘troika’ of international creditors not end ‘of verification in progress. “We are the first to want to go back to finance Greece,” said Draghi, noting that the ECB ‘and’ an organization based on the rules, not a political institution. “

The securities purchased by the ECB will have a maturity ‘two to three decades and can not exceed 25% of the debt issued in every single issue, and 33% of the total debt of a country. Purchases of sovereign debt will be done in practice by national central banks, which will provide for 80% of the bonds purchased. Therefore, the risk will be ‘shared by the ECB and national banks only 20% of the bonds you buy, or all of the securities of supranational European institutions (12% above) and a share of sovereign bonds at 8% of the total.

Finally, continue, at the same time ‘Qe’, purchases of mortgage-backed securities (asset-backed securities) and covered bonds, which currently progressing at the rate of 13 billion Euros per month .