Draghi Reassures Euro-Area That the Worst is Over
European Central Bank President Mario Draghi made a speech on Tuesday afternoon reassuring Europeans that region was on its way to recovery. In contrast to his press conference following the ECB monthly meeting, the euro saw little change following his positive remarks.
The euro held steadily near $1.33 and traded at 1.3298 on Wednesday morning. The currency has been on the mend since the end of 2012, when most began to see the light at the end of the tunnel for the eurozone. The region, which is still in recession, is expected to recover during the second half of 2013.
For now, Draghi encouraged people to focus on the future as in his view, the worst is over. According to Bloomberg, Draghi credited ECB policy decisions in 2012 for progress in the region. He also reassured investors that the bank's promise to purchase bonds from struggling countries in unlimited quantity still stood, although unused.
The eurozone economy is projected to contract by 0.3 percent in 2013, a figure that underscores the idea that the region is not yet out of the woods. Draghi addressed this concern saying he expected a gradual recovery later in 2013.
Draghi drove home the idea that the region would need to continue working for a more unified financial structure, and eventually, deeper economic and political ties. The ECB will continue working to finalize plans for a single European bank supervisor this year, with the new structure forecast to be complete and ready for implementation in March 2014.
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