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The Editors

Europe Isn’t Ready for the Next Recession

Its central bank just loosened monetary policy. What if that isn’t enough?

Next time, whatever it takes won’t do.

Next time, whatever it takes won’t do.

Photographer: Jasper Juinen/Bloomberg via Getty Images

The European Central Bank surprised financial markets yesterday with moves to loosen monetary policy. The prospects for growth in the euro zone have dimmed lately, and policy was going to be tweaked at some point unless things picked up. But a change wasn’t expected so soon. ECB President Mario Draghi and his colleagues are apparently worried.

They have reason to be. Their main problem, however, isn’t the precise timing of monetary adjustments like the ones announced this week. It’s the lack of good options if things get any worse.