Top central bankers face renewed pressure to keep rates low, bolster easy-money policies
Central banks in the U.S., Europe and Japan face renewed pressure to keep interest rates low or expand easy-money policies in response to gyrating stock markets, tumbling oil prices and slow growth in China and elsewhere.
In a telling example, European Central Bank President Mario Draghi sent a strong signal Thursday he is prepared to launch additional monetary stimulus in March, a response to persistently low inflation tied to slow growth and falling commodities prices.
“We don’t give up,” Mr. Draghi said at a news conference in Frankfurt. “We are not surrendering in front of these global factors.”
In Japan, calls are increasing for Bank of Japan Gov. Haruhiko Kuroda to launch new stimulus measures as early as next week, with Japan’s economy sputtering and inflation near zero.
“The credibility of BOJ policy will likely take a hit” if the central bank doesn’t act, said Yuichi Kodama, chief economist at Meiji Yasuda Life Insurance. Inaction, he said, could lead investors to believe the central bank has run out of measures that might help.
