Draghi Fights Deflation With Banks Not Bonds, for Now
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Mario Draghi is betting the banking system rather than the bond market is his best ally for now in the fight against deflation.
Acting in a more sweeping fashion than most investors anticipated, the European Central Bank yesterday cut interest rates to unprecedented lows and its president unveiled measures to beef up lending for banks in a bid to revive inflation languishing at close to a quarter of his target.