Draghi’s Soft Euro Talk Suggests He’s Holding Back the Magic

“An exchange rate shock of the magnitude observed in recent months would have a non-negligible impact on the outlook for euro area inflation,” the ECB staff wrote in an analysis attached to the projections. “The recent appreciation, by contrast, is likely to have been triggered in large part by the further improved outlook for economic growth in the euro area, which in turn reflects improved prospects for domestic demand.”

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