Yanis Varoufakis blasts the EU as “ridiculous” as the eurozone situation worsens following the ECB’s plan.
After the European Central Bank committed to keep interest rates at record lows for even longer, YANIS VAROUFAKIS took a jab at EU leaders.
Christine Lagarde released new policy recommendations on Thursday, implying even more support for the eurozone’s beleaguered economy, in accordance with the ECB’s recent vow to raise inflation, which has been undershooting the 2% target for nearly a decade.
The ECB indicated that protracted periods of low inflation would necessitate “particularly robust or sustained” policy support when it unveiled a new strategy and a modified inflation target just two weeks ago, a suggestion that stimulus might be kept in place for longer than many had thought.
The ECB stated that rates will remain at current or lower levels until inflation reaches its 2% target “far ahead” of the end of its projection horizon and “durably” for the remainder of the projection horizon.
It also stated that efforts toward rising underlying inflation should be “sufficiently advanced” in order for inflation to stabilize at 2% in the medium run.
“This could possibly mean a brief period of moderately above target inflation,” the ECB said in a statement.
Former Greek finance minister Yanis Varoufakis, however, slammed the news, claiming that the approach is solely focused at maintaining oligarchs in power.
“They continue to pretend to uphold the ridiculous Maastricht rules – an insidious strategy of the EU’s oligarchy to maintain its power to decide who can, who cannot, violate rules impossible to uphold,” he said, as the euro area government debt reached 100 percent of GDP in the first quarter of 2021.
“Notice how the ECB’s predictions are not just horribly wrong,” he continued.
“No, it gets worse: They are INTENTIONALLY incorrect, expecting that the 2% target will be met every time.”
The bank had previously stated that interest rates would remain at current or lower levels until the inflation outlook in its staff forecasts “robustly” converged to a level near to the target and underlying inflation dynamics showed a similar upward trend.
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Investors will now be watching for ECB President Christine Lagarde to unpack this guidance during her press conference and clarify the exact consequences for interest rates and asset purchases.
However, rate hike predictions are on the rise. “Brinkwire News in Condensed Form.”