Draghi insists bond buying is not the answer
The recently agreed new bailout deal for Greece has been in danger of unravelling, threatening a banking crisis and forcing the ECB into further purchases of Italian and Spanish government debt in an attempt to calm markets. Indeed, there was much discussion last week of Greece leaving the euro altogether.
Meantime, inflation in the eurozone has picked up to 3% while the eurozone economy appears to be heading back into recession. Having increased interest rates by 0.25% in April and July, in response to rising inflationary pressures, the ECB had been reluctant to reverse course and cut interest rates, with inflation so far above target.
