Today in Frankfurt the European Central Bank (ECB) will hold its latest meeting. The “word” is the focus will be to bring down Spain’s cost of borrowing.
We know ECB president Mario Draghi is ready to do “whatever it takes” to support the Euro and if Spain needs a bailout, it is expected the ECB will take unprecedented steps to help.
It is clear that although past measures have helped, but weren’t fully effective and did not achieve the end goal (at least so far). We would expect that if nothing is done to lower and stabilise the borrowing costs of countries like Spain and Italy then their future within the euro will be in question.
Mr Draghi has confirmed he will hold a news conference later on Thursday.
US Federal Reserve Wednesday – 1 August 2012
The US Federal Reserve took no further steps to boost the economy but said that it “will provide additional accommodation as needed to promote a stronger economic recovery”. This is following confirmation that the growth in the US Economy (as measured by GDP) in the first 6 months of 2012 had slowed.
ECB Resume Bond-Buying?
At a conference in London last week marking the start of the Olympics, Mr Draghi said: “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.”
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