Roughly 30 months ago, European Central Bank president Mario Draghi pledged to do “whatever it takes” to save the euro.

His resolve is about to be tested. In what will be one of the most important days in the relatively short history of Europe’s single currency, on Thursday January 22, the ECB is widely expected to announce a multi-billion euro stimulus programme. The policy, known as quantitative easing, or QE, was used by the USA, the UK and Japan in the aftermath of the 2008 financial crisis. It was also used in a slightly different form in Europe in 2009, when the ECB signalled that it would focus on buying covered bonds, a type of corporate debt. But the details of the latest potential round of European QE are still very vague – perhaps a reflection of the behind-the-scenes negotiations that have been taking place to find a programme of bond purchases that will satisfy the various eurozone member nations, and particularly its biggest, Germany. The ECB goal is simple: it...


Andrea Hotter

January 21, 2015

21:29 GMT

New York