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BBC: ECB extends bond-buying scheme but at slower pace

Article published: Dec 8, 2016 – out of date: no longer suitable for your IB Economics commentary

IB Economics syllabus: Macroeconomics (Monetary policy)

At times of low economic growth and very low inflation, Centrtal Banks use expansionary monetary policies to get things going. This includes decreasing interest rates and increasing the money supply. While interest rates are already very low in the Eurozone (although they might fall further in the future), this time the European Central Bank (ECB) decided to continue increasing the money supply by continuing buying bonds until the end of 2017.

For the official statement, CLICK HERE.

Source of image: Getty images

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