The euro weakens on yet another hint from Mario Draghi that the ECB is primed for further stimulus next month. As David Pollard reports, a more competitive European single currency could be exactly the result the central bank chief is pursuing.
It's little over a week since Mario Draghi's last pledge. This time, if anything, it was even stronger. SOUNDBITE: Mario Draghi, European Central Bank President, saying (English): "If we decide that the current trajectory of our policy is not sufficient to achieve our objective, we will do what we must to raise inflation as quickly as possible. That is what our price stability mandate requires of us." The ECB President has masterminded a policy of buying 60 billion euros of mostly government bonds since March. The aim: to boost a reluctant euro zone recovery. But prices rose just 0.1 per cent in October. He could now top up that QE programme. Or cut an already negative deposit rate. Or both - with, possibly, the added bonus for Draghi of what the Fed might do. Lloyds Bank's Adam Chester. SOUNDBITE: Adam Chester, head of economic research, Lloyds Bank Commercial Banking, saying (English): "If we get a double whammy of further ECB stimulus in December, and, as we expect, a quarter point rise in US interest rates, then euro dollar could head down towards parity, conceivably. And, of course, that is what the ECB wants to see - they want to see the euro head lower to promote euro zone competitiveness, and also to increase import prices to help drive inflation higher as well." Not everyone's happy at the prospect of more ECB stimulus. Bundesbank President Jens Weidmann told the same conference in Frankfurt that he saw no reason 'to paint a gloomy picture'. More time needed to let current measures feed through, he said. ECB policymakers announce their decision on December 3rd.