European shares moved up at the end of the trading day as the euro lost ground on news that Greece’s debt situation can be contained once again.
President of the European Central Bank (ECB) Mario Draghi told reporters at a news conference Thursday that the central bank was ready to provide additional assistance to Athens if further stimulus was called for.
“As in March and in June, the ECB is on the record stating that it is prepared to ease policy if data does not meet expectations. At a time of heightened global uncertainty, even such a simple message is a good start,” he said.
Draghi’s warnings of lower growth and weaker inflation triggered more bond buying from Europe’s central bank and sent all the main indices up for the day.
The FTSE 100 closed up 110 points, or 1.8%, at 6194, making up for some of the losses suffered a week ago.
The euro sharply down tonight; it has shed more than one cent against the US dollar to languish around $1.1107.
Lower Inflation Forecast
The central bank lowered its forecasts for inflation and economic growth, citing a slowdown in emerging markets and weaker oil prices and as anticipated lowered its forecasts for inflation and economic growth.
The ECB sees inflation at 1.1 percent next year, below its June forecast of 1.5 percent, and expects GDP growth in 2016 of 1.7 percent versus its June forecast of 1.9 percent.
Draghi also announced that the central bank has raised the amount of any one issue it could buy to 33 percent from 25 percent and added that the quantitative easing program, whereby the bank would buy 60 billion euros ($66.7 billion) worth of bonds a month could run "beyond" its original deadline of September 2016.