When Draghi admits the “side effects” of its policy … – Challenges.fr

Speaking at a conference at the International Monetary Fund in Washington, Mario Draghi said the asset purchases initiated by the ECB “has proved effective up here, more than many observers had anticipated. “

He repeated that quantitative easing program which aims to encourage the recovery by keeping rates low and to counter deflation risks , would be implemented “in its entirety”.

“We will apply the asset purchase program as a whole as advertised and anyway until we see a sustained fit of the trajectory Inflation “, he said.

The program will be” fully “applied

” Our monetary stimulus will remain in place as long as necessary ” , he added while speculation had run in April on premature termination of these extraordinary measures.

Public Debt Redemptions mass Private and the ECB must continue until at least September 2016 at the rate of 60 billion per month.

Speaking of “side effects” of a very low interest rate policy continues, Mario Draghi reported that it was necessary to be mindful of its impact on wealth distribution and resource allocations. “It is important that these consequences be identified, weighed and correct them when necessary,” he said.

Stay alert

Mario Draghi mentioned that he had to “be aware that too prolonged period of very low real interest rates can have adverse consequences in aging societies” where many households are concerned about long-term their retirement savings.

“For these retirees and those saving for retirement, low interest rates are not an incentive to consume,” he said. “On the contrary, it motivates save more to offset the slowdown in the accumulation of assets,” added the head of the ECB.

In the United States, where ultra-loose monetary policy conducted for more than six years, the rebound in consumer spending still does not seem to go despite lower fuel prices which would free up the purchasing power.

No rebound in spending Consumers in the US

“What’s happening with the consumer? It’s a mystery!”, recently asked an official at the Fed, Dennis Lockhart.

“The recent drop in gasoline prices should boost spending. Instead, there is a sharp increase of almost one percentage point, the saving rate in the 1st quarter, which rose from 4.6% to 5.5% “, he had reported.

On a visit to Washington, Mario Draghi would then meet on Thursday US Secretary of Treasury Jack Lew.

(With agencies)