ECB To Hold Policy Intact Comment on Political Stability

The European Central Bank is set to stick to its policy course on Wednesday while keeping a wary eye on stumbling blocks to the euro zone’s nascent recovery.

Fresh political turmoil in Italy after former premier Silvio Berlusconi told his ministers to quit the coalition government could cause jitters beyond Italian shores, particularly if early elections are required.

ECB chief Mario Draghi last week raised the possibility of action if market interest rates push too high for comfort, saying the banking system could again be primed with long-term loans if necessary.

But Wednesday’s Governing Council meeting in Paris – one of two meetings theECB holds outside of Frankfurt each year – is unlikely to see it delve back into its policy toolbox, not least because the U.S. Federal Reserve has eased the pressure to act.

via CNBC

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