November 3, 2011
Mario Draghi has ushered in a distinct change of style - but not necessarily substance - at the European Central Bank as he combined a cut in interest rates with a clear-cut warning that he sees a limited role for the ECB in combating the eurozone debt crisis.
In a confident performance at a press conference in Frankfurt on Thursday, Mr Draghi justified lowering the ECB’s main interest rate from 1.5 per cent to 1.25 per cent by citing the sharp worsening in recent economic data and by pre-announcing “significant downward revision” to 2012 growth forecasts, to be published next month.
Mr Draghi’s debut as ECB president came at one of the most dramatic moments in the eurozone debt crisis, with the fate of Greece’s membership of the 13-year old monetary union unclear as he spoke. The unfolding events complicated the discussion by the ECB’s 23-strong governing council, which feared being seen as reacting to political events in one of the monetary union’s smallest countries.