On Thursday the President of the European Central Bank Mr. Mario Draghi reduced the main interest rate from 0.15% to 0.05% and made public his intention to carry out quantitative easing monetary measures in order to support the recovery of the European economy.
Under the threat of deflation and under the pressure of the recessive circumstances that are emerging in Europe, he essentially nullified the interest rates – the rates for the banks will be negative, meaning they will have to pay if the transfer money to the Eupopean bank – in order to urge banks and business to take the risk and investment initiatives.
Despite the delay, the European Central Bank’s turn creates hope for greater change in the European financial policy. The obsession with fiscal goals and strict policies of budgetary contraction appear to be coming to an end and alluding to growth policies.
Perhaps it is too early to make any final conclusions, but the pressure from all the European countries is enough to force a general change.
In this sense Greece, which has been under immense pressure to implement the most extreme policies of budgetary contraction, may now hope to at least a partial relief from the strict framework imposed by partners and creditors.
The truth is that under pressure of the circumstances something is changing in Europe.
The question is whether this will carry on and whether the Greek banks will take advantage of these new circumstances.
To use the new available resources, gain the much-needed cash flow and divert it in a rational way to support sustainable businesses, those which had growth potential and which the crisis immobilized and bound.
TO VIMA
