Draghi and the ECB did a fine job in saving the Eurozone from disaster when few expected the central bank could do the job
The 72-year-old Italian banker is widely credited with saving the euro zone from collapse, but some critics say he also overpowered opponents and tended to front-run the bank's monetary policy in public.
The ECB, which kept interest rates unchanged for now, said it saw rates at present or lower levels through mid-2020, giving up a previous pledge to keep rates unchanged through next June.
The problem is that with rates at record lows and the ECB's balance sheet already swelled to 4.7 trillion euros ($5.3 trillion), its remaining ammunition is limited, raising doubts about the likely effectiveness of any further measures.
The ECB last week decided to end its 2.6 trillion euro bond purchase programme by the close of the year but said interest rates would stay unchanged at least through next summer, a wording that pushed back rate hike expectations by three months to September.
"The inflation outlook remains predictably anaemic, and if President Draghi is to be taken at his dovish word, that should imply filling up the bowl," Anatoli Annenkov, an economist at Societe Generale, said.
U.S. short-term interest rate futures rose slightly, reflecting reduced expectations that the Fed will raise interest rates further this year, after Yellen skipped mention of it when speaking in Jackson Hole, Wyoming.
Dow Jones Industrial Average fell 28.69 points, or 0.13 percent, to 21,783.4, the S&P 500 lost 5.07 points, or 0.21 percent, to 2,438.97 and the Nasdaq Composite dropped 7.08 points, or 0.11 percent, to 6,271.33.
An ECB spokesman said that Draghi will focus on the theme of the symposium, fostering a dynamic global economy, in his Aug. 25 remarks, while the sources added that he was keen to hold off on the policy discussion until the autumn, as agreed at the last rate-setting meeting in July.
Gold prices firmed on Wednesday on lower equities and a weaker U.S. dollar after European Central Bank President Mario Draghi hinted the ECB could trim its stimulus this year.
The ECB proposal to European Union states, seen by Reuters, says that a draft piece of legislation on foreign bank regulation already under discussion among the 28 EU members should be toughened further.
The euro zone economy may be improving, but a change in the European Central Bank's policy guidance could backfire, tightening financial conditions, policymakers concluded at their March 9 meeting, the minutes of the discussion showed on Thursday.
While the US Fed plans more rate hikes later this year, it is the policy outcome of two other central banks that are more important and should be looked out for, says Bill Gross.
While the global scenarios is looking up, certain hurdles like the upcoming elections in France in next 2-3 months will be in focus. The upcoming rate hike by the US Federal Reserve next week is already factored in, said Andrew Holland, Chief Executive Officer at Avendus Capital Alternate Strategies.
Although economic growth and inflation are both picking up, the ECB is expected to resist calls to tighten policy, pointing to political risks, weak underlying price growth and a still fragile recovery nearly a decade after the bloc's economic woes began.
Rising oil prices will lead to higher inflation in the eurozone over the next two years than previously expected, a European Central Bank survey said today.
The ECB had said it would extend its generous bond-buying program at its December meeting albeit at a reduced pace of purchases. The central bank explained the new pace of asset purchases would be scaled back from 80 billion euros ($85.3 billion) a month to 60 billion euros from April onward.
Policymakers at the Frankfurt institution chose in December to keep interest rates at historic lows and extend mass bond-buying from March to December this year, albeit slowing the purchases from 80 to 60 billion euros (USD 85 to USD 64 billion) per month from April.
DAVOS, Switzerland (Reuters) - A trade war between the United States and China and a strengthening dollar are among the biggest threats to a brightening global economic outlook, according to leading economists at the World Economic Forum in Davos.
The ECB said it would cut monthly purchases to 60 billion euros from the current 80 billion euros but extend the buys until the end of 2017. Markets had expected purchases to stay at 80 billion but only for 6 more months, suggesting a compromise between hawks and doves in the Governing Council.
ECB President Mario Draghi said on Wednesday the bank will look at a combination of policy tools when it meets on December 8 and that ultra-easy monetary policy has given governments in the region time for reforms. Those efforts need to be stepped up, he said.
"The euro area economy continues to expand at a moderate but steady pace, despite the adverse effects of global economic and political uncertainty," Draghi told an EU Parliament committee.
The pair's differing views reveals the rift over the main topic of debate on the ECB Governing Council as it prepares to decide next month on whether to extend the bank's 1.74 trillion euro asset-buying scheme.
The European Central Bank kept interest rates and policy guidance unchanged on Thursday but may lay the groundwork for more easing to come in December as it tries to sustain a long-awaited rebound in consumer prices.
Keeping interest rates and an 80-billion-euro per month bond buying programme unchanged, ECB President Mario Draghi will likely emphasize the continued need for monetary stimulus, reinforcing expectations for an extension of the ECB's asset buys beyond its scheduled end next March.