Investors swarmed into sovereign debt and fled the volatility of stock markets on Thursday after the ECB cut its growth forecast.
Investors around the world swarmed into sovereign debt and fled the volatility of stock markets on Thursday after Europe's central bank cut its growth forecast, rekindling fears that a slowdown overseas could send shock waves into the American economy.
But where the ECB took investors mostly by surprise was in its decision to announce a new round of stimulus and push back its timeline for future rate hikes"at least through the end of 2019." It also lowered its inflation projection to 1.2 percent, well below its target rate of just under 2 percent. "While it was no surprise to us, the ECB has finally recognized how sick their economy is," said Andrew Brenner of National Alliance."Equities have finally woken up to the fact that the reason the Fed is on hold is because of the awful outlook of the global economies."
"They didn't leave anything in their back pocket," Misra added."If I'm the ECB, I'm really hoping today is enough to provide a floor."
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