A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

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Aug 28 2014

“Draghinomics” to the Rescue?

With Eurozone inflation close to a five-year low in July, and GDP coming to a standstill in the second quarter, European Central Bank President Mario Draghi announced his intentions last week to employ a policy mix of monetary, fiscal, and structural measures to boost the slumping Eurozone – similar to Abenomics’ “three arrows.”

But with the “success” of Abenomics due more to its implementation months after cyclical upswings in Japanese inflation and economic growth had already taken hold than to its brilliance as policy, is Draghi’s version of the three arrows really likely to change the Eurozone’s fortunes?

ECRI’s latest study provides a definitive answer to this question, examining the drivers of Eurozone inflation and growth to determine how preexisting inflation and economic cycles will affect the potency of Draghinomics.

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