The European Central Bank approved a bigger-than-expected expansion of its stimulus package on Thursday to prop up an economy plunged by the coronavirus pandemic into its worst recession since the Second World War.
Just months after a first raft of crisis measures, the ECB said it would raise bond purchases by €600 billion (Dh2.48 trillion) to €1.35tn and that purchases would run at least until end-June 2021, six months longer than first planned.
It also said it would reinvest proceeds from maturing bonds in its pandemic emergency purchase scheme at least until the end of 2022.
ECB President Christine Lagarde put an end to speculation that the bank could follow the US Federal Reserve in buying sub-investment grade bonds, however, saying that option was not even discussed by policymakers.
The announcement, which comes just weeks after Germany's Constitutional Court ruled that the ECB had already been exceeding its mandate with a longstanding asset purchase programme, prompted a rally in the euro and bond markets.
"Today's easing measures were another illustration that the ECB means business and stands ready to do whatever is necessary to help the euro area survive the corona crisis in one piece. The ECB will do its part, and it hopes the governments will do their part," Nordea analysts said in a note.
The bank dramatically revised downward its baseline scenario for euro zone output this year to a contraction of 8.7 per cent from the modest 0.8 per cent rise it had forecast only in March.
It predicted a partial rebound with growth of 5.2 per cent next year and 3.3 per cent in 2022 but Ms Lagarde told a news conference that signs of any recovery so far were "tepid" and that risks to its baseline projection were on the downside.
"The euro area economy is experiencing an unprecedented contraction. There has been an abrupt drop in economic activity as a result of the coronavirus pandemic and the measures taken to contain it," Ms Lagarde said.
She said she was confident that a "good solution" could be found on the legal stand-off with Germany's top court.
Ms Lagarde welcomed what she called the "ambitious" proposal of the European Commission for a €1.1tn budget for the bloc for 2021-27 with an extra recovery fund worth €750bn.
Cash-rich Germany, which can borrow at negative rates for up to 20 years, separately unveiled a €130bn stimulus package late on Wednesday.
The ECB earlier committed to buying up to €1.1tn worth of bonds this year. But even record purchases have struggled to bring down yields on debt issued by countries on the 19-nation bloc's periphery, particularly Italy, hit hard by the virus and already struggling with a large debt burden.
More bond buys are also becoming urgent because the ECB is on track to exhaust its purchase quota by the autumn, raising some doubts about its capacity or willingness to buy the amounts needed to keep yields down.
How to avoid crypto fraud
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Expert advice
“Join in with a group like Cycle Safe Dubai or TrainYAS, where you’ll meet like-minded people and always have support on hand.”
Stewart Howison, co-founder of Cycle Safe Dubai and owner of Revolution Cycles
“When you sweat a lot, you lose a lot of salt and other electrolytes from your body. If your electrolytes drop enough, you will be at risk of cramping. To prevent salt deficiency, simply add an electrolyte mix to your water.”
Cornelia Gloor, head of RAK Hospital’s Rehabilitation and Physiotherapy Centre
“Don’t make the mistake of thinking you can ride as fast or as far during the summer as you do in cooler weather. The heat will make you expend more energy to maintain a speed that might normally be comfortable, so pace yourself when riding during the hotter parts of the day.”
Chandrashekar Nandi, physiotherapist at Burjeel Hospital in Dubai
Sholto Byrnes on Myanmar politics
ANDROID%20VERSION%20NAMES%2C%20IN%20ORDER
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A State of Passion
Directors: Carol Mansour and Muna Khalidi
Stars: Dr Ghassan Abu-Sittah
Rating: 4/5
Why it pays to compare
A comparison of sending Dh20,000 from the UAE using two different routes at the same time - the first direct from a UAE bank to a bank in Germany, and the second from the same UAE bank via an online platform to Germany - found key differences in cost and speed. The transfers were both initiated on January 30.
Route 1: bank transfer
The UAE bank charged Dh152.25 for the Dh20,000 transfer. On top of that, their exchange rate margin added a difference of around Dh415, compared with the mid-market rate.
Total cost: Dh567.25 - around 2.9 per cent of the total amount
Total received: €4,670.30
Route 2: online platform
The UAE bank’s charge for sending Dh20,000 to a UK dirham-denominated account was Dh2.10. The exchange rate margin cost was Dh60, plus a Dh12 fee.
Total cost: Dh74.10, around 0.4 per cent of the transaction
Total received: €4,756
The UAE bank transfer was far quicker – around two to three working days, while the online platform took around four to five days, but was considerably cheaper. In the online platform transfer, the funds were also exposed to currency risk during the period it took for them to arrive.
The%20end%20of%20Summer
%3Cp%3EAuthor%3A%20Salha%20Al%20Busaidy%3C%2Fp%3E%0A%3Cp%3EPages%3A%20316%3C%2Fp%3E%0A%3Cp%3EPublisher%3A%20The%20Dreamwork%20Collective%C2%A0%3C%2Fp%3E%0A
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20Revibe%20%0D%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202022%0D%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Hamza%20Iraqui%20and%20Abdessamad%20Ben%20Zakour%20%0D%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20UAE%20%0D%3Cbr%3E%3Cstrong%3EIndustry%3A%3C%2Fstrong%3E%20Refurbished%20electronics%20%0D%3Cbr%3E%3Cstrong%3EFunds%20raised%20so%20far%3A%3C%2Fstrong%3E%20%2410m%20%0D%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EFlat6Labs%2C%20Resonance%20and%20various%20others%0D%3C%2Fp%3E%0A
UK-EU trade at a glance
EU fishing vessels guaranteed access to UK waters for 12 years
Co-operation on security initiatives and procurement of defence products
Youth experience scheme to work, study or volunteer in UK and EU countries
Smoother border management with use of e-gates
Cutting red tape on import and export of food
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
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