Daily Archives: May 3, 2012

Today’s governing council meeting at the ECB marked a return to “business as usual” after the dramatic injections of liquidity into the banking system in December and February. The ECB understandably wants to return to its regular duties, where it focuses on keeping inflation below its 2 per cent long term target, and is desperate to shift the burden for other aspects of managing the eurozone economy back to member governments.

Mario Draghi’s main message in recent weeks has been that “the ball is in the court of governments” in three different ways: the need for fiscal consolidation, bank recapitalisation and a “growth strategy” involving labour and product market reform. Assuming satisfactory progress on these three objectives, the ECB would retire to the relative obscurity of inflation control, a place where it is always happy to find itself. “Non standard” monetary measures, which involve the use of the ECB balance sheet to finance troubled banks and sovereigns, would no longer be needed.

Unfortunately, it is improbable that the ECB will be granted its wish to remain on the sidelines for very long. The key question is how, when and where it will be called back into action.

 Read more

Claire Jones

Mario Draghi. Image by Getty.

Mario Draghi. Image by Getty.

Hello and welcome to today’s live blog on the ECB’s press conference.

ECB president Mario Draghi is in Barcelona, where he will be responding to journalists’ questions from 13.30 UK time.

All times are UK time.


14.33 This live blog is now closed.

14.31 The questions end.

14.31 Can Mr Draghi understand the anger of poor, jobless young people? Read more

Claire Jones

The European Central Bank has held rates, as expected.

The ECB’s benchmark main refinancing rates remains at 1 per cent. The rates on the marginal lending facility and the deposit facility remain unchanged at 1.75 per cent and 0.25 per cent respectively. Read more

Claire Jones

Auditors are supposed to know “where the bodies are buried”. Or at least root out evidence of anything with a whiff of misconduct.

So it perhaps wasn’t PricewaterhouseCoopers’ finest hour when, in December, its investigation cleared former Swiss National Bank chairman Philipp Hildebrand of any wrongdoing over those FX transactions, only for Mr Hildebrand to resign a little more than a fortnight later.

PwC told the Financial Times that, despite his resignation, there was no “wrongdoing” by Mr Hildebrand as he complied with internal regulations, which formed the basis of their review. “It was not our duty to assess the behaviour of Mr Hildebrand other than with regard to the compliance with the internal regulations,” PwC said. They also noted that they qualified one transaction as “sensitive”.

Still, it will not make much difference to PwC’s bottom line; it emerged late last week following the conclusion of the SNB’s shareholders’ meeting which took place in Berne that the auditor will continue to work for Switzerland’s central bank.  Read more