14 Jul 2014
IMF urges ECB to consider implementing QE
FXStreet (Łódź) - The International Monetary Fund released a report today in which it pointed out that economic recovery in the Eurozone lags while markets remain excessively fragmented and urged the ECB to consider carrying out asset purchases if low inflation persists.
"If inflation remains too low the ECB should consider a substantial balance sheet expansion, including through asset purchases," IMF said in the report. "The broadly neutral overall fiscal stance is appropriate but any negative growth surprises should not trigger additional consolidation efforts as this would be self-defeating."
Furthermore, the IMF lowered its 2014 GDP growth forecast for the Eurozone to 1.1% from 1.2% seen in April and cut the inflation outlook to 0.7% from 0.9%.
"If inflation remains too low the ECB should consider a substantial balance sheet expansion, including through asset purchases," IMF said in the report. "The broadly neutral overall fiscal stance is appropriate but any negative growth surprises should not trigger additional consolidation efforts as this would be self-defeating."
Furthermore, the IMF lowered its 2014 GDP growth forecast for the Eurozone to 1.1% from 1.2% seen in April and cut the inflation outlook to 0.7% from 0.9%.