MEPs quizz Mario Draghi on bond buying, crypto currencies and interest rates
- ECB programme purchasing European corporate sector bonds helps lending to smaller firms
- Crypto currencies: regulate or ban
- Interest rates: when to change them
Corporate bond purchase programme (CBPP) effectiveness and Bitcoin ban were among the topics raised by MEPs in a debate with ECB President Draghi.
MEPs quizzed ECB President Mario Draghi on whether the programme allowing the ECB to buy bonds issued by European companies was effective, asking for proof that the bonds purchased by the ECB had given banks more space to lend to smaller companies. They also insisted that the ECB purchase decisions should be transparent and in line with sustainable development and climate goals.
There was also a question on whether to regulate crypto currencies, such as Bitcoin, or to ban them, and whether higher capital requirements for FinTech, financial services enabled by new technologies, were to protect the banking sector. To that, Mr Draghi responded that such innovations are prone to a risk of cyber-attack, therefore FinTech companies should put more capital aside to mitigate for this risk.
MEPs also asked when the Eurozone would achieve the 2% inflation target and when the right time to increase interest rates would be. “Interest rates will be changed depending on inflation”, Mr Draghi said. He stressed that inflation, excluding food and energy prices, has not shown convincing signs of fluctuating, because of the sluggish growth of wages, which are primary inflation drivers.
