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Opinion
Mark Gilbert

Draghi Disses the Euro

The ECB's acknowledgment that market prices suggest inflation is undershooting its target by half demands more action than policy makers are contemplating. 
Going down?
Going down?

There are several takeaways from European Central Bank President Mario Draghi's news conference today, none of them heartening to those who fear the euro region is sliding into adeflationary spiral.

Policy makers seems to be in denial that falling prices are a threat; "the current low level of inflation should be followed by a gradual upward movement," Draghi said. Loan demand is picking up just as a new program to funnel cash to banks kicks in -- a triumph of central bank timing, Draghi suggested. And a decline in the euro -- because "the fundamentals for a weaker exchange rate are much better than they were" -- will also help the ECB reach its inflation target, Draghi argued.