NICOSIA, Cyprus (AP) – The European Central Bank will unleash its 1.1 trillion euro ($1.2 trillion) stimulus program on Monday – and says the prospect is already boosting the eurozone economy.
Mario Draghi, the bank’s president, said consumers and businesses in the 19 euro countries are benefiting not only from cheaper energy prices but also from optimism over the coming stimulus.
He cited “a significant number of positive effects” from the January announcement of the massive stimulus plan, on top of previous efforts to loosen credit to businesses. Borrowing conditions are already considerably easier, he noted.
“Looking ahead, we expect the economic recovery to broaden and strengthen,” Draghi told reporters after the bank kept its key interest rate on hold at its monthly meeting Thursday. The comments helped push up European stocks and sent the euro to a 12-year low.
The ECB raised its eurozone growth forecast for this year to 1.5 percent from 1.0 percent amid signs credit is flowing more easily. Draghi cautioned that some member states’ failure to make pro-growth reforms would dampen the recovery.