Italians flocked to bars, restaurants and cinemas following an easing of coronavirus restrictions Monday, as Prime Minister Mario Draghi unveiled a massive EU-funded plan he said would shape the crisis-hit country's future.

After months of stop-start restrictions imposed to manage second and third waves of Covid-19,&nbsp;Italy&nbsp;hopes this latest easing will mark the start of something like a normal summer.

"I've cleared my schedule," enthused 71-year-old Ottavio Rosati, a movie director in Rome. "I'm booked up with museums, restaurants and bars... I'm not going to sit still!"

Draghi has admitted to taking a "calculated risk" with the reopenings, as infection rates have fallen but Covid-19 deaths still mount by hundreds every day, to more than 119,000.

Italian businesses are desperate to reopen after the pandemic sparked the deepest recession since the end of World War II.

The country is pinning its hopes on a 220-billion-euro ($266-billion) plan funded by the European Union, which Draghi told lawmakers Monday would affect "the country's destiny".

Three-quarters of regions dropped Monday into the lower-risk "yellow" category, with bars and restaurants permitted to restart table service outside -- including, for the first time in six months, in the evening, although a 10 pm curfew remains in place.

"Finally!" said Daniele Vespa, the 26-year-old head waiter at Baccano, a restaurant near Rome's Trevi Fountain,, telling AFP: "It's the start of a return to normality."

Cinemas, theatres and concert halls can also open at 50-percent capacity, followed by the staggered opening of swimming pools, gyms, sporting events and theme parks by July 1.

In Milan, the Beltrade cinema claimed the title of being the first to reopen after six months of inaction with a special 06:00 am screening of "Caro Diario," a classic Italian film from the 1990s.

"I went with my husband, and it was great to be back together in a cinema and do this crazy thing," said Francesca Pierangeli, one of 82 people at the sold-out show.

Draghi had been under intense pressure to ease restrictions, including from far-right leader Matteo Salvini and increasingly vocal anti-lockdown street protests.

The vaccination programme is gaining pace with 17.75 million jabs administered so far in a population of around 60 million, but experts doubt this could be enough to stave off a new health crisis.&nbsp;

"Clearly if the gradual reopening is interpreted as a 'free-for-all', a new surge in infections risks compromising the summer season," warned Nino Cartabellotta, head of the GIMBE Foundation health think tank.

Already at the weekend, throngs of people took advantage of the warm weather and packed the streets of central Rome and other cities, causing police to close off some crowded areas.

Italy&nbsp;was the first European country to be hit by the pandemic in early 2020 and remains one of the worst affected, with the EU's highest reported death toll.

Draghi told parliament on Monday the 222.1-billion-euro investment and reform plan would affect "the country's destiny, the extent of its role in the international community, its credibility and reputation" on the world stage.

Italy&nbsp;is the main beneficiary of the EU's 750-billion-euro post-pandemic recovery fund, but is under intense scrutiny to spend the money wisely. The plan must be submitted to Brussels by Friday for approval.

The government hopes the plan will boost growth by 3.6 percentage points by 2026, after the economy shrank by a staggering 8.9 percent last year on the back of coronavirus closures.

Priorities include infrastructure, notably high-speed railways; green energy, including hydrogen power projects; investment in internet services and digitalisation of public administration.

There will be money to help women and young people, who have disproportionately lost out during the pandemic, while around 40 percent will be targeted at historically under-performing southern&nbsp;Italy.

Draghi, a former European Central Bank (ECB) chief, has also highlighted the importance of tax reform and speeding up the snail-paced justice system -- noting it currently takes about 500 days to conclude a civil suit, against 200 in Germany.&nbsp;

Disputes over the spending plan brought down the previous prime minister and his coalition, after which Draghi was parachuted in to lead a national unity government in February.

On Monday, he said&nbsp;Italy&nbsp;would pull through. "I am sure that honesty, intelligence and a taste for the future will prevail over corruption, stupidity and vested interests."

Italians flocked to bars, restaurants and cinemas following an easing of coronavirus restrictions Monday, as Prime Minister Mario Draghi unveiled a massive EU-funded plan he said would shape the crisis-hit country's future.

Italians flocked to bars, restaurants and cinemas following an easing of coronavirus restrictions Monday, as Prime Minister Mario Draghi unveiled a massive EU-funded plan he said would shape the crisis-hit country's future. After months of stop-start restrictions imposed to manage second and third waves of Covid-19, Italy hopes this latest easing will mark the start of something like a normal summer. "I've cleared my schedule," enthused 71-year-old Ottavio Rosati, a movie director in Rome. "I'm booked up with museums, restaurants and bars... I'm not going to sit still!" Draghi has admitted to taking a "calculated risk" with the reopenings, as infection rates have fallen but Covid-19 deaths still mount by hundreds every day, to more than 119,000. Italian businesses are desperate to reopen after the pandemic sparked the deepest recession since the end of World War II. The country is pinning its hopes on a 220-billion-euro ($266-billion) plan funded by the European Union, which Draghi told lawmakers Monday would affect "the country's destiny". Three-quarters of regions dropped Monday into the lower-risk "yellow" category, with bars and restaurants permitted to restart table service outside -- including, for the first time in six months, in the evening, although a 10 pm curfew remains in place. "Finally!" said Daniele Vespa, the 26-year-old head waiter at Baccano, a restaurant near Rome's Trevi Fountain,, telling AFP: "It's the start of a return to normality." Cinemas, theatres and concert halls can also open at 50-percent capacity, followed by the staggered opening of swimming pools, gyms, sporting events and theme parks by July 1. In Milan, the Beltrade cinema claimed the title of being the first to reopen after six months of inaction with a special 06:00 am screening of "Caro Diario," a classic Italian film from the 1990s. "I went with my husband, and it was great to be back together in a cinema and do this crazy thing," said Francesca Pierangeli, one of 82 people at the sold-out show. Draghi had been under intense pressure to ease restrictions, including from far-right leader Matteo Salvini and increasingly vocal anti-lockdown street protests. The vaccination programme is gaining pace with 17.75 million jabs administered so far in a population of around 60 million, but experts doubt this could be enough to stave off a new health crisis. "Clearly if the gradual reopening is interpreted as a 'free-for-all', a new surge in infections risks compromising the summer season," warned Nino Cartabellotta, head of the GIMBE Foundation health think tank. Already at the weekend, throngs of people took advantage of the warm weather and packed the streets of central Rome and other cities, causing police to close off some crowded areas. Italy was the first European country to be hit by the pandemic in early 2020 and remains one of the worst affected, with the EU's highest reported death toll. Draghi told parliament on Monday the 222.1-billion-euro investment and reform plan would affect "the country's destiny, the extent of its role in the international community, its credibility and reputation" on the world stage. Italy is the main beneficiary of the EU's 750-billion-euro post-pandemic recovery fund, but is under intense scrutiny to spend the money wisely. The plan must be submitted to Brussels by Friday for approval. The government hopes the plan will boost growth by 3.6 percentage points by 2026, after the economy shrank by a staggering 8.9 percent last year on the back of coronavirus closures. Priorities include infrastructure, notably high-speed railways; green energy, including hydrogen power projects; investment in internet services and digitalisation of public administration. There will be money to help women and young people, who have disproportionately lost out during the pandemic, while around 40 percent will be targeted at historically under-performing southern Italy. Draghi, a former European Central Bank (ECB) chief, has also highlighted the importance of tax reform and speeding up the snail-paced justice system -- noting it currently takes about 500 days to conclude a civil suit, against 200 in Germany. Disputes over the spending plan brought down the previous prime minister and his coalition, after which Draghi was parachuted in to lead a national unity government in February. On Monday, he said Italy would pull through. "I am sure that honesty, intelligence and a taste for the future will prevail over corruption, stupidity and vested interests."

Italy reopens as PM Mario Draghi unveils historic recovery plan

Italian Prime Minister Mario Draghi said on Wednesday that he will use "all means" to fight coronavirus pandmic and that it presented Italy with an opportunity to rebuild as it did after Second World War. This was his first speech since taking office. Mario Draghi, the former chief of European Central Bank said that the pandemic was his top priority in a long list of issues requiring urgent attention.

"The government will carry out reforms but will also tackle the emergency," he told the Senate, the upper house of parliament, where he has almost unanimous support for his new government of national unity.

The 73-year-old, parachuted in after the previous centre-left government collapsed, has been dubbed "Super Mario" since promising to do "whatever it takes" to save the euro during the 2012 debt crisis.

On Wednesday he promised to fight "with all means" the pandemic that has left more than 94,000 Italians dead and sparked a deep recession, with the economy contracting almost nine percent last year.

"Today we have, as did the governments of the immediate post-war period, the possibility -- or rather the responsibility -- to start a new reconstruction," Draghi said in his almost hour-long address.

Draghi's new government invlves wide range of parties from Silvio Berlusconi's &nbsp;Forza Italia along with leftist the populist Five Star Movement (M5S) and Matteo Salvini's eurosceptic, far-right League

Draghi was sworn in on Saturday as Italy's 30th prime minister. This ended month-long political crisis sparkes by implosion of former PM Giuseppe Conte's coalition.

On Wednesday, Draghi said it was a time of "intense emotion" personally to take over with Italy in such a "dramatic situation".

There is an increased concern about the new coronavirus variant in Italy. This has sparked a series of mini-lockdowns in towns across Italy, Draghi emphasised the importance of speeding up vaccinations.

Long-awaited overhaul

Another immediate challenge is drawing up a plan to spend what Draghi has previously called the "extraordinary resources" offered by the EU. 
Italy expects to receive more than 200 billion euros ($240 billion) from the EU's post-coronavirus recovery fund, but in return, it is expected to commit to potentially difficult or unpopular reforms.

"These resources will have to be spent with an aim to improve the growth potential of our economy," Draghi said.

He promised reform to Italy's stifling bureaucracy, labyrinthine tax code and snail-paced justice system, as well as a focus on education, closing the gap on female employment and fighting climate change.

In a second speech on Wednesday evening, he also pleaded for a revival of a failed policy: forcing EU countries to each take a share of the migrants arriving from across the Mediterranean, after years of Italy shouldering much of the burden.

"As a concrete measure of solidarity, Italy -- supported equally by certain Mediterranean countries -- proposes a mechanism of obligatory redistribution of migrants," he said.

Draghi has assembled a cabinet comprising a mix of politicians and technocrats, with key portfolios linked to the EU reform agenda given to technocrats.

Late Wednesday, the Senate passed a vote of confidence -- 262 in favour, 40 against and two absentations -- in &nbsp;Draghi's government. There will be another vote in the lower Chamber of Deputies on Thursday.

(With AFP inputs)

Italian Prime Minister Mario Draghi said on Wednesday that he will use "all means" to fight coronavirus pandmic and that it presented Italy with an opportunity to rebuild as it did after Second World War.

Italian Prime Minister Mario Draghi said on Wednesday that he will use "all means" to fight coronavirus pandmic and that it presented Italy with an opportunity to rebuild as it did after Second World War. This was his first speech since taking office. Mario Draghi, the former chief of European Central Bank said that the pandemic was his top priority in a long list of issues requiring urgent attention. "The government will carry out reforms but will also tackle the emergency," he told the Senate, the upper house of parliament, where he has almost unanimous support for his new government of national unity. The 73-year-old, parachuted in after the previous centre-left government collapsed, has been dubbed "Super Mario" since promising to do "whatever it takes" to save the euro during the 2012 debt crisis. On Wednesday he promised to fight "with all means" the pandemic that has left more than 94,000 Italians dead and sparked a deep recession, with the economy contracting almost nine percent last year. "Today we have, as did the governments of the immediate post-war period, the possibility -- or rather the responsibility -- to start a new reconstruction," Draghi said in his almost hour-long address. Draghi's new government invlves wide range of parties from Silvio Berlusconi's Forza Italia along with leftist the populist Five Star Movement (M5S) and Matteo Salvini's eurosceptic, far-right League Draghi was sworn in on Saturday as Italy's 30th prime minister. This ended month-long political crisis sparkes by implosion of former PM Giuseppe Conte's coalition. On Wednesday, Draghi said it was a time of "intense emotion" personally to take over with Italy in such a "dramatic situation". There is an increased concern about the new coronavirus variant in Italy. This has sparked a series of mini-lockdowns in towns across Italy, Draghi emphasised the importance of speeding up vaccinations. Long-awaited overhaul Another immediate challenge is drawing up a plan to spend what Draghi has previously called the "extraordinary resources" offered by the EU. Italy expects to receive more than 200 billion euros ($240 billion) from the EU's post-coronavirus recovery fund, but in return, it is expected to commit to potentially difficult or unpopular reforms. "These resources will have to be spent with an aim to improve the growth potential of our economy," Draghi said. He promised reform to Italy's stifling bureaucracy, labyrinthine tax code and snail-paced justice system, as well as a focus on education, closing the gap on female employment and fighting climate change. In a second speech on Wednesday evening, he also pleaded for a revival of a failed policy: forcing EU countries to each take a share of the migrants arriving from across the Mediterranean, after years of Italy shouldering much of the burden. "As a concrete measure of solidarity, Italy -- supported equally by certain Mediterranean countries -- proposes a mechanism of obligatory redistribution of migrants," he said. Draghi has assembled a cabinet comprising a mix of politicians and technocrats, with key portfolios linked to the EU reform agenda given to technocrats. Late Wednesday, the Senate passed a vote of confidence -- 262 in favour, 40 against and two absentations -- in Draghi's government. There will be another vote in the lower Chamber of Deputies on Thursday. (With AFP inputs)

Italy PM Mario Draghi sets out plan to rebuild virus-hit country

Mario Draghi, former European Central Bank chief on Friday formally accepted Italy's prime ministerial post. He will now lead the government set to&nbsp;replace Giuseppe Conte's centre-left coalition that collapsed a month ago. Draghi, the 73-year-old economist, spoke with Italy President Sergio Mattarella and spoke only to list the names of his ministers, a mix of politicians and technocrats. Draghi will return to the presidential palace at midday on Saturday to be formally sworn in, a spokesman for Mattarella said.

The senior deputy governor of Bank of Italy, Daniele Franco, was named as the new economy minister, while Roberto Speranza and Luigi Di Maio stay on at health and foreign affairs, respectively.

Draghi will take the reins when Italy has not fully recovered from the blow of coronavirus pandemic.

More than 93,000 people with coronavirus have died in Italy since it became the first European country to face the full force of the pandemic one year ago, and the toll is still rising by the hundreds each day.

Also Read | <a href="https://www.wionews.com/world/eu-to-spare-turkey-from-tax-blacklist-sources-say-363228">EU to spare Turkey from tax blacklist, sources say</a>

Shutdowns and coronavirus restrictions have plunged Italy, eurozone's third-largest economy into its worst recession since second world war. More than 420,000 people have lost their jobs.

Coalition, for now?

President Sergio Mattarella asked Draghi to form a new government on February 3, and the respected economist has spent the last nine days assembling the widest possible majority in parliament.

Almost all the main parties are behind him, from leftists to Matteo Salvini's far-right League, and including the populist Five Star Movement (M5S), the centre-left Democratic Party (PD) and Italia Viva, who shared power before.

Draghi was expected to present a list of ministers to Mattarella, before being formally sworn in on Saturday.

M5S, the biggest party in parliament which began life as an anti-establishment movement, was split over whether to support a government led by an unelected technocrat.

But in an online vote, members backed Draghi by 59 per cent, after it claimed to have secured the promise to set up a new super-ministry for "ecological transition".

Uphill challenges

Italy has high hopes for its new leader, dubbed "Super Mario" after vowing to do "whatever it takes" to save the euro single currency during the 2010s debt crisis.&nbsp;

His arrival was greeted with delight by the financial markets, and Italy's borrowing costs dropped to a historic low this week.

But "it is difficult to overstate the scale of the challenges that Draghi and Italy face", said Luigi Scazzieri, of the Centre for European Reform.

The economy shrank by a staggering 8.9 per cent last year, while Covid-19 remains rife and restrictions including a night curfew and the closure of bars and restaurants in the evening remain in place.

(With AFP inputs)

Mario Draghi, former European Central Bank chief on Friday formally accepted Italy's prime ministerial post. He will now lead the government set to replace Giuseppe Conte's centre-left coalition that collapsed a month ago.

Mario Draghi, former European Central Bank chief on Friday formally accepted Italy's prime ministerial post. He will now lead the government set to replace Giuseppe Conte's centre-left coalition that collapsed a month ago. Draghi, the 73-year-old economist, spoke with Italy President Sergio Mattarella and spoke only to list the names of his ministers, a mix of politicians and technocrats. Draghi will return to the presidential palace at midday on Saturday to be formally sworn in, a spokesman for Mattarella said. The senior deputy governor of Bank of Italy, Daniele Franco, was named as the new economy minister, while Roberto Speranza and Luigi Di Maio stay on at health and foreign affairs, respectively. Draghi will take the reins when Italy has not fully recovered from the blow of coronavirus pandemic. More than 93,000 people with coronavirus have died in Italy since it became the first European country to face the full force of the pandemic one year ago, and the toll is still rising by the hundreds each day. Also Read | EU to spare Turkey from tax blacklist, sources say Shutdowns and coronavirus restrictions have plunged Italy, eurozone's third-largest economy into its worst recession since second world war. More than 420,000 people have lost their jobs. Coalition, for now? President Sergio Mattarella asked Draghi to form a new government on February 3, and the respected economist has spent the last nine days assembling the widest possible majority in parliament. Almost all the main parties are behind him, from leftists to Matteo Salvini's far-right League, and including the populist Five Star Movement (M5S), the centre-left Democratic Party (PD) and Italia Viva, who shared power before. Draghi was expected to present a list of ministers to Mattarella, before being formally sworn in on Saturday. M5S, the biggest party in parliament which began life as an anti-establishment movement, was split over whether to support a government led by an unelected technocrat. But in an online vote, members backed Draghi by 59 per cent, after it claimed to have secured the promise to set up a new super-ministry for "ecological transition". Uphill challenges Italy has high hopes for its new leader, dubbed "Super Mario" after vowing to do "whatever it takes" to save the euro single currency during the 2010s debt crisis. His arrival was greeted with delight by the financial markets, and Italy's borrowing costs dropped to a historic low this week. But "it is difficult to overstate the scale of the challenges that Draghi and Italy face", said Luigi Scazzieri, of the Centre for European Reform. The economy shrank by a staggering 8.9 per cent last year, while Covid-19 remains rife and restrictions including a night curfew and the closure of bars and restaurants in the evening remain in place. (With AFP inputs)

Mario Draghi formally accepts Italy's prime ministerial post

The Italian president swore in the former chief of the European Central Bank, Mario Draghi, as prime minister on Saturday at the head of a unity government called on to confront the coronavirus crisis and economic slump.

Mario Draghi sworn-in as Italian Prime Minister

The Italian president swore in the former chief of the European Central Bank, Mario Draghi, as prime minister on Saturday at the head of a unity government called on to confront the coronavirus crisis and economic slump.

All but one of Italy`s major parties have rallied to his side and his cabinet includes lawmakers from across the political spectrum, as well as technocrats in key posts, including the finance ministry and a new green transition portfolio.

Much now rests on Draghi`s shoulders.

He is tasked with plotting Italy`s recovery from the pandemic and must immediately set to work on plans for how to spend more than 200 billion euros ($240 billion) in European Union funds aimed at rebuilding the recession-bound economy.

If he prevails, Draghi will likely bolster the entire eurozone, which has long fretted over Italy`s perenial problems.

Success would also prove to Italy`s sceptical northern allies that by offering funds to the poorer south, they will fortify the entire bloc.

But he faces enormous challenges. Italy is mired in its worst downturn since World War Two, hundreds of people are still dying of COVID-19 each day, the vaccination campaign is going slowly and he only has limited time to sort things out.

Italy is due to return to the polls in two years time, but it is far from certain that Draghi will be able to survive that long at the head of a coalition that includes parties with radically opposing views on issues such as immigration, justice, infrastructure development and welfare.

Highlighting Italy`s political instability, Draghi`s government is the 67th to take office since 1946 and the seventh in the last decade alone.

The Italian president swore in the former chief of the European Central Bank, Mario Draghi, as prime minister on Saturday at the head of a unity government called on to confront the coronavirus crisis and economic slump. All but one of Italy`s major parties have rallied to his side and his cabinet includes lawmakers from across the political spectrum, as well as technocrats in key posts, including the finance ministry and a new green transition portfolio. Much now rests on Draghi`s shoulders. He is tasked with plotting Italy`s recovery from the pandemic and must immediately set to work on plans for how to spend more than 200 billion euros ($240 billion) in European Union funds aimed at rebuilding the recession-bound economy. If he prevails, Draghi will likely bolster the entire eurozone, which has long fretted over Italy`s perenial problems. Success would also prove to Italy`s sceptical northern allies that by offering funds to the poorer south, they will fortify the entire bloc. But he faces enormous challenges. Italy is mired in its worst downturn since World War Two, hundreds of people are still dying of COVID-19 each day, the vaccination campaign is going slowly and he only has limited time to sort things out. Italy is due to return to the polls in two years time, but it is far from certain that Draghi will be able to survive that long at the head of a coalition that includes parties with radically opposing views on issues such as immigration, justice, infrastructure development and welfare. Highlighting Italy`s political instability, Draghi`s government is the 67th to take office since 1946 and the seventh in the last decade alone.

Italy's Draghi sworn in as prime minister of unity government

The former European Central Bank chief, Mario Draghi, on Friday formally accepted Italy's prime ministerial post. The development comes after weeks of political turmoil following the resignation of former prime minister Giuseppe Conte's who lost the government majority in the senate due to inability to handle the covid-19 crisis.

Mario Draghi formally accepted Italy's Prime Ministerial post

The Italian President has asked the former head of European Central bank Mario Draghi to form a new government after the collapse of former Prime Minister's coalition government.

Italy's Draghi asked to form the new Italian govt, seeks party backing to end turmoil

Global stocks rallied on Tuesday and benchmark government bond yields tumbled after <a href="https://www.wionews.com/world/european-central-bank-will-ease-policy-if-inflation-doesnt-pick-up-draghi-228287">European Central Bank President Mario Draghi</a> hinted at economic stimulus, with equities getting an extra boost from confirmation that <a href="https://www.wionews.com/world/us-china-rekindle-trade-talks-ahead-of-donald-trump-xi-jinping-g20-meeting-228545">US President Donald Trump</a> would meet China's president to talk about trade.

The euro also weakened after Draghi said the ECB will ease policy again if inflation fails to accelerate, signalling one of the biggest policy reversals of his eight-year tenure.

Draghi's comments spurred talk that the Federal Reserve would also soon start easing monetary policy by cutting interest rates, with the US central bank set to give its policy statement on Wednesday.

"In the US, it got translated into, 'Oh great, this means the Fed will have to cut,'" said Carol Schleif, deputy chief investment officer with Abbot Downing in Minneapolis. "But we don’t necessarily think they have to or should this soon."

The Fed is expected to leave borrowing costs unchanged at its meeting this week but possibly lay the groundwork for a rate cut later this year.

<a href="https://www.wionews.com/world/trump-to-meet-chinas-top-trade-negotiator-as-deadline-presses-199044">Trump</a> has sought to influence the Fed to cut rates. In response to Draghi's comments, Trump on Tuesday accused the ECB president of trying to weaken the euro to gain an unfair competitive advantage.

Trump also said he would have an extended meeting with Chinese President Xi Jinping at the G20 summit later this month, as the world's two largest economies rekindle trade talks. China, which previously declined to say whether the two leaders would meet, confirmed the get-together.

"There had been some question in markets in the last few days about whether or not that meeting was going to happen," Schleif said. "It remains to be seen what comes out of that meeting."

MSCI's gauge of stocks across the globe gained 1.04%.

On Wall Street, the Dow Jones Industrial Average rose 353.01 points, or 1.35%, to 26,465.54, the S&amp;P 500 gained 28.08 points, or 0.97%, to 2,917.75 and the Nasdaq Composite added 108.86 points, or 1.39%, to 7,953.88.

The pan-European STOXX 600 index rose 1.67%, its best day since January.

Benchmark bond yields fell globally following Draghi's hints of more stimulus, with German bond yields hitting record lows deep in negative territory, around -0.32%, and French 10-year yields turning negative for the first time.

Benchmark US 10-year notes last rose 8/32 in price to yield 2.0578%, from 2.086% late on Monday.

"Draghi was extremely dovish and this had a big impact on Treasuries as we anticipate the Federal Reserve," said Ellis Phifer, market strategist at Raymond James in Memphis, Tennessee.

The dollar index, which measures the greenback against a basket of currencies, rose 0.06%, with the euro down 0.18% to $1.1197.

Oil prices rose sharply after Trump confirmed his meeting with Xi.

US crude settled up 3.8% at $53.90 a barrel, while Brent settled at $62.14 a barrel, up 2%.

Global stocks rallied on Tuesday and benchmark government bond yields tumbled after European Central Bank President Mario Draghi hinted at economic stimulus, with equities getting an extra boost from confirmation that US President Donald Trump would meet China's president to talk about trade.

Global stocks rallied on Tuesday and benchmark government bond yields tumbled after European Central Bank President Mario Draghi hinted at economic stimulus, with equities getting an extra boost from confirmation that US President Donald Trump would meet China's president to talk about trade. The euro also weakened after Draghi said the ECB will ease policy again if inflation fails to accelerate, signalling one of the biggest policy reversals of his eight-year tenure. Draghi's comments spurred talk that the Federal Reserve would also soon start easing monetary policy by cutting interest rates, with the US central bank set to give its policy statement on Wednesday. "In the US, it got translated into, 'Oh great, this means the Fed will have to cut,'" said Carol Schleif, deputy chief investment officer with Abbot Downing in Minneapolis. "But we don’t necessarily think they have to or should this soon." The Fed is expected to leave borrowing costs unchanged at its meeting this week but possibly lay the groundwork for a rate cut later this year. Trump has sought to influence the Fed to cut rates. In response to Draghi's comments, Trump on Tuesday accused the ECB president of trying to weaken the euro to gain an unfair competitive advantage. Trump also said he would have an extended meeting with Chinese President Xi Jinping at the G20 summit later this month, as the world's two largest economies rekindle trade talks. China, which previously declined to say whether the two leaders would meet, confirmed the get-together. "There had been some question in markets in the last few days about whether or not that meeting was going to happen," Schleif said. "It remains to be seen what comes out of that meeting." MSCI's gauge of stocks across the globe gained 1.04%. On Wall Street, the Dow Jones Industrial Average rose 353.01 points, or 1.35%, to 26,465.54, the S&P 500 gained 28.08 points, or 0.97%, to 2,917.75 and the Nasdaq Composite added 108.86 points, or 1.39%, to 7,953.88. The pan-European STOXX 600 index rose 1.67%, its best day since January. Benchmark bond yields fell globally following Draghi's hints of more stimulus, with German bond yields hitting record lows deep in negative territory, around -0.32%, and French 10-year yields turning negative for the first time. Benchmark US 10-year notes last rose 8/32 in price to yield 2.0578%, from 2.086% late on Monday. "Draghi was extremely dovish and this had a big impact on Treasuries as we anticipate the Federal Reserve," said Ellis Phifer, market strategist at Raymond James in Memphis, Tennessee. The dollar index, which measures the greenback against a basket of currencies, rose 0.06%, with the euro down 0.18% to $1.1197. Oil prices rose sharply after Trump confirmed his meeting with Xi. US crude settled up 3.8% at $53.90 a barrel, while Brent settled at $62.14 a barrel, up 2%.

Stocks lifted by hopes for monetary policy, US-China trade

European Central Bank chief Mario Draghi said Tuesday that the institution "doesn't target the exchange rate", shrugging off an allegation of currency manipulation from US President Donald Trump.

"We have our remit. We have our mandate. Our mandate is price stability" or inflation just below two per cent, Draghi told a central banking conference in Sintra, Portugal.

"We are ready to use all the instruments that are ready to fulfil this mandate, and we don't target the exchange rate," he added.

Draghi's statement that <a href="https://www.wionews.com/world/european-central-bank-will-ease-policy-if-inflation-doesnt-pick-up-draghi-228287">weak economic growth and sluggish inflation</a> could prompt the ECB to slash further rates already at historic lows had earlier sparked Trump's ire.

"Mario Draghi just announced more stimulus could come, which immediately dropped the Euro against the Dollar, making it unfairly easier for them to compete against the USA," Trump said via Twitter.

"They have been getting away with this for years, along with China and others," he added.

Draghi said in a speech that "further cuts in policy interest rates... remain part of our tools" as the bank looks to juice growth and inflation.

Eurozone policymakers had already discussed potential rate cuts in early June, but Draghi's Tuesday remarks were the first to catch markets' full attention.

That was in part because he said the central bank was ready to move "in the absence of improvement" rather than if economic conditions worsen, lowering the threshold for action.

Germany's DAX index of blue-chip shares leapt into the black from negative territory -- adding 2.1 per cent around 5:15 pm (1515 GMT) -- and pushed the euro down as much as 0.3 per cent against the dollar, to $1.12, before rebounding slightly.

"German DAX way up due to stimulus remarks from Mario Draghi. Very unfair to the United States!" Trump tweeted.

Many of the DAX companies like carmaker BMW or chemical company Bayer, in fact, have a massive US presence.

And 10-year government bond yields in France briefly dipped into negative territory for the first time ever -- joining Germany, the Netherlands and Austria in the club of countries investors pay to lend them money -- before ticking up to 0.01 per cent mid-afternoon.

Draghi's speech was "the clearest indication yet that the bank will cut interest rates and relaunch its asset purchase programme in the coming months if... measures of inflation and inflation expectations remain very low," said Andrew Kenningham of Capital Economics.

From the start of his presidency in 2017, Trump accused trading partners like China and eurozone heavyweight Germany of currency manipulation.

Both countries and others like Japan and South Korea remain on a Washington watchlist, the US Treasury Department said last month, but have not been formally singled out as manipulators.

Action in the air

The ECB blames weakening economic growth on US-led trade conflicts, the looming threat of a no-deal Brexit and slower performance from emerging economies.

With the slower expansion, price growth was well short of the ECB goal of just below two per cent in May, at 1.2 per cent.

"In the absence of improvement, such that the sustained return of inflation to our aim is threatened, the additional stimulus will be required," Draghi said.

Aside from rate cuts, the ECB could restart its 2.6 trillion euro ($2.9 trillion) "quantitative easing" (QE) purchases of government and corporate debt.

For now, the Frankfurt-based central bank is on hold after promising no rate rises until at least mid-2020, while the US Federal Reserve is also making hints towards its first rate cut in more than a decade as confidence ebbs from the economy.

Virgin territory

Any new lowering of rates in the eurozone would be a step further into the unknown for the ECB, which has since 2014 charged banks to park cash with it, using a negative deposit rate now at -0.4 per cent.

"We think the bank will cut its deposit rate from -0.4 to -0.5 per cent in December," Capital Economics' Kenningham predicted.

Meanwhile, any restart of QE might require loosening some of the ECB's self-imposed rules on the scheme, designed to fend off allegations it is financing government spending by printing money.

Nevertheless, "the asset purchase programme still has considerable headroom," Draghi said.

European Central Bank chief Mario Draghi said Tuesday that the institution "doesn't target the exchange rate", shrugging off an allegation of currency manipulation from US President Donald Trump.

European Central Bank chief Mario Draghi said Tuesday that the institution "doesn't target the exchange rate", shrugging off an allegation of currency manipulation from US President Donald Trump. "We have our remit. We have our mandate. Our mandate is price stability" or inflation just below two per cent, Draghi told a central banking conference in Sintra, Portugal. "We are ready to use all the instruments that are ready to fulfil this mandate, and we don't target the exchange rate," he added. Draghi's statement that weak economic growth and sluggish inflation could prompt the ECB to slash further rates already at historic lows had earlier sparked Trump's ire. "Mario Draghi just announced more stimulus could come, which immediately dropped the Euro against the Dollar, making it unfairly easier for them to compete against the USA," Trump said via Twitter. "They have been getting away with this for years, along with China and others," he added. Draghi said in a speech that "further cuts in policy interest rates... remain part of our tools" as the bank looks to juice growth and inflation. Eurozone policymakers had already discussed potential rate cuts in early June, but Draghi's Tuesday remarks were the first to catch markets' full attention. That was in part because he said the central bank was ready to move "in the absence of improvement" rather than if economic conditions worsen, lowering the threshold for action. Germany's DAX index of blue-chip shares leapt into the black from negative territory -- adding 2.1 per cent around 5:15 pm (1515 GMT) -- and pushed the euro down as much as 0.3 per cent against the dollar, to $1.12, before rebounding slightly. "German DAX way up due to stimulus remarks from Mario Draghi. Very unfair to the United States!" Trump tweeted. Many of the DAX companies like carmaker BMW or chemical company Bayer, in fact, have a massive US presence. And 10-year government bond yields in France briefly dipped into negative territory for the first time ever -- joining Germany, the Netherlands and Austria in the club of countries investors pay to lend them money -- before ticking up to 0.01 per cent mid-afternoon. Draghi's speech was "the clearest indication yet that the bank will cut interest rates and relaunch its asset purchase programme in the coming months if... measures of inflation and inflation expectations remain very low," said Andrew Kenningham of Capital Economics. From the start of his presidency in 2017, Trump accused trading partners like China and eurozone heavyweight Germany of currency manipulation. Both countries and others like Japan and South Korea remain on a Washington watchlist, the US Treasury Department said last month, but have not been formally singled out as manipulators. Action in the air The ECB blames weakening economic growth on US-led trade conflicts, the looming threat of a no-deal Brexit and slower performance from emerging economies. With the slower expansion, price growth was well short of the ECB goal of just below two per cent in May, at 1.2 per cent. "In the absence of improvement, such that the sustained return of inflation to our aim is threatened, the additional stimulus will be required," Draghi said. Aside from rate cuts, the ECB could restart its 2.6 trillion euro ($2.9 trillion) "quantitative easing" (QE) purchases of government and corporate debt. For now, the Frankfurt-based central bank is on hold after promising no rate rises until at least mid-2020, while the US Federal Reserve is also making hints towards its first rate cut in more than a decade as confidence ebbs from the economy. Virgin territory Any new lowering of rates in the eurozone would be a step further into the unknown for the ECB, which has since 2014 charged banks to park cash with it, using a negative deposit rate now at -0.4 per cent. "We think the bank will cut its deposit rate from -0.4 to -0.5 per cent in December," Capital Economics' Kenningham predicted. Meanwhile, any restart of QE might require loosening some of the ECB's self-imposed rules on the scheme, designed to fend off allegations it is financing government spending by printing money. Nevertheless, "the asset purchase programme still has considerable headroom," Draghi said.

European Central Bank chief Draghi brushes off Donald Trump's charge of currency manipulation

The <a href="https://www.wionews.com/business-economy/bond-yields-spiral-lower-take-stocks-along-for-the-ride-206161">European Central Bank </a>will ease policy again if inflation does not rise back to its target, ECB President <a href="https://www.wionews.com/business-economy/asia-stocks-firm-euro-sags-after-dovish-ecb-192609">Mario Draghi</a> said on Tuesday, reinforcing expectations for even more stimulus in the coming weeks.

The ECB has undershot its inflation target of just under 2 per cent since 2013 and a slowdown in growth amid a global trade war has raised the risk that price growth will ease further, unravelling the impact of unprecedented accommodation.

"In the absence of improvement, such that the sustained return of inflation to our aim is threatened, the additional stimulus will be required," Draghi told the ECB's annual conference in Sintra, Portugal.

He said the ECB could still cut rates, adjust its guidance, offer mitigating measures to counter the unwanted side effects of negative rates and it also had "considerable headroom" for more asset purchases.

The comments, taken by markets as unexpectedly dovish, sent the euro down by a quarter of a per cent against the dollar while stocks erased early losses and bond yields fell further, many into record low territory.

Markets have already priced in 15-20 basis points of cuts in the ECB's minus 0.40% deposit rate - a big change compared to the start of the year when rate hikes were firmly on the table.

"Will use all the flexibility within our mandate to fulfil our mandate – and we will do so again to answer any challenges to price stability in the future," Draghi said.

Adding an argument for the urgency of action, Draghi noted that growth risks are tilted to the downside and indicators for the coming quarters point to lingering softness.

The ECB would now use the "coming weeks" to study its options, a suggestion that indicated action from the bank may come sooner rather than later.

Limits

Draghi also dismissed market concerns that asset purchases lacked potency as the ECB was coming up against its self-imposed limits, including a rule that prevents it from buying more than one-third of a particular country's debt.

He noted that the limits are flexible because the ECB's legal powers allow it to deploy tools that are both necessary and proportionate.

He said the European Court of Justice had already confirmed that the ECB has broad discretion in using its tools.

Although the ECJ cleared the asset purchases in an earlier ruling, it argued that limits on the buys must be in place, suggesting that any change in those limits could land the ECB back in court.

The ECB sees inflation at 1.4% next year and market-based inflation expectations point to a slowdown in the years ahead.

But Draghi said the ECB would not accept low inflation and would fulfil its mandate, even if the fiscal policy did not provide the necessary support.

"We are committed, and are not resigned to having a low rate of inflation forever or even for now," Draghi said. "That aim is symmetric, which means that, if we are to deliver that value of inflation in the medium term, inflation has to be above that level at some time in the future."

The European Central Bank will ease policy again if inflation does not rise back to its target, ECB President Mario Draghi said on Tuesday, reinforcing expectations for even more stimulus in the coming weeks.

The European Central Bank will ease policy again if inflation does not rise back to its target, ECB President Mario Draghi said on Tuesday, reinforcing expectations for even more stimulus in the coming weeks. The ECB has undershot its inflation target of just under 2 per cent since 2013 and a slowdown in growth amid a global trade war has raised the risk that price growth will ease further, unravelling the impact of unprecedented accommodation. "In the absence of improvement, such that the sustained return of inflation to our aim is threatened, the additional stimulus will be required," Draghi told the ECB's annual conference in Sintra, Portugal. He said the ECB could still cut rates, adjust its guidance, offer mitigating measures to counter the unwanted side effects of negative rates and it also had "considerable headroom" for more asset purchases. The comments, taken by markets as unexpectedly dovish, sent the euro down by a quarter of a per cent against the dollar while stocks erased early losses and bond yields fell further, many into record low territory. Markets have already priced in 15-20 basis points of cuts in the ECB's minus 0.40% deposit rate - a big change compared to the start of the year when rate hikes were firmly on the table. "Will use all the flexibility within our mandate to fulfil our mandate – and we will do so again to answer any challenges to price stability in the future," Draghi said. Adding an argument for the urgency of action, Draghi noted that growth risks are tilted to the downside and indicators for the coming quarters point to lingering softness. The ECB would now use the "coming weeks" to study its options, a suggestion that indicated action from the bank may come sooner rather than later. Limits Draghi also dismissed market concerns that asset purchases lacked potency as the ECB was coming up against its self-imposed limits, including a rule that prevents it from buying more than one-third of a particular country's debt. He noted that the limits are flexible because the ECB's legal powers allow it to deploy tools that are both necessary and proportionate. He said the European Court of Justice had already confirmed that the ECB has broad discretion in using its tools. Although the ECJ cleared the asset purchases in an earlier ruling, it argued that limits on the buys must be in place, suggesting that any change in those limits could land the ECB back in court. The ECB sees inflation at 1.4% next year and market-based inflation expectations point to a slowdown in the years ahead. But Draghi said the ECB would not accept low inflation and would fulfil its mandate, even if the fiscal policy did not provide the necessary support. "We are committed, and are not resigned to having a low rate of inflation forever or even for now," Draghi said. "That aim is symmetric, which means that, if we are to deliver that value of inflation in the medium term, inflation has to be above that level at some time in the future."

European Central Bank will ease policy if inflation doesn't pick up: Chief Draghi

Asian stocks rose across the board on Friday, buoyed by gains in US technology shares while investors awaited several key events next week including US-China trade talks.

The euro struggled near a six-week low versus the dollar following dovish-sounding comments from European Central Bank President Mario Draghi, who expressed concerns about the eurozone economy.

MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.95 per cent to scale its highest since December 4.

The index was headed for a gain of 0.6 per cent this week, with strong corporate earnings helping somewhat to counter growing concerns over slowing global economic growth.

The Shanghai Composite Index rose 0.6 per cent.

Tech-heavy South Korean shares added 0.9 per cent. Australian stocks climbed 0.8 per cent, lifted by higher prices of commodities such as iron ore and crude oil.

Japan's Nikkei advanced 1.4 per cent with technology companies boosted by a surge in their US peers.

"Investors who were already excited about the U.S. chip sector's earnings the day before got even more reassured after they saw how their stocks moved," said Shogo Maekawa, a global market strategist at JPMorgan Asset Management.

Maekawa added that a recovery in the global cyclical chip sector is taken as a silver-lining amid concerns about a global economic slowdown.

A synchronised global economic slowdown is underway and any escalation in the US-China trade war would trigger a sharper downturn, according to the latest Reuters polls of hundreds of economists from around the world.

"Equities may be drawing some support but the markets are bracing for next week's events," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

"The US-China trade discussions will provide insight into how talks are progressing, while the British parliamentary voting is a key Brexit event. And there is also the FOMC (Federal Open Market Committee) meeting."

Chinese Vice Premier Liu He will visit the United States on January 30 and 31 for the next round of trade negotiations with Washington.

The two sides are "miles and miles" from resolving trade issues but there is a fair chance they will get a deal, US Commerce Secretary Wilbur Ross said on Thursday.

The British parliament will debate and vote on Prime Minister Theresa May's Brexit "plan B" on January 29, and the US Federal Reserve concludes a two-day policy setting meeting on January 30.

The Nasdaq had risen roughly 0.7 per cent on Thursday thanks to a rally by chipmakers, while the S&amp;P 500 edged higher and the Dow closed nominally lower as anxiety about slowing global growth and the Sino-U.S. trade dispute undercut a spate of strong earnings.

In currency markets, the euro was a shade firmer at $1.1316 but still in close reach of a six-week trough of $1.1289 plumbed overnight. The euro was down 0.4 per cent this week.

The single currency slid after ECB President Draghi acknowledged on Thursday that economic growth in the euro zone was likely to be weaker than earlier expected due to the fall-out from factors ranging from China's slowdown to Brexit.

Germany has dropped its economic growth forecast for 2019 to 1.0 per cent from 1.8 per cent due to slower global economic growth and uncertainty about Britain's exit from the European Union, the Handelsblatt newspaper reported on Thursday.

The ECB had left its policy stance unchanged as expected on Thursday and Draghi's downbeat comments added to speculation that the central bank will hold back on interest rate hikes that some market watchers had expected in October.

The pound was up 0.4 per cent at $1.3109 after brushing a two-month high of $1.3130, lifted after The Sun reported on Thursday that Northern Ireland's Democratic Unionist Party has privately decided to back Prime Minister May's Brexit deal next week if it includes a clear time limit to the Irish backstop.

The dollar nudged up 0.1 per cent to 109.74 yen and on track to end the week little changed.

The benchmark 10-year US Treasury note yield was slightly higher at 2.724 per cent after dropping to a one-week low as concerns over slowing global growth supported safe-haven government debt.

Crude oil extended gains after rallying the previous day as the United States threatened sanctions on Venezuela's crude exports as the country descended further into political and economic turmoil.

US crude oil futures were up 1.3 per cent at $53.82 per barrel after gaining 1 per cent on Thursday.

Asian stocks rose across the board on Friday, buoyed by gains in US technology shares while investors awaited several key events next week including US-China trade talks.

Asian stocks rose across the board on Friday, buoyed by gains in US technology shares while investors awaited several key events next week including US-China trade talks. The euro struggled near a six-week low versus the dollar following dovish-sounding comments from European Central Bank President Mario Draghi, who expressed concerns about the eurozone economy. MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.95 per cent to scale its highest since December 4. The index was headed for a gain of 0.6 per cent this week, with strong corporate earnings helping somewhat to counter growing concerns over slowing global economic growth. The Shanghai Composite Index rose 0.6 per cent. Tech-heavy South Korean shares added 0.9 per cent. Australian stocks climbed 0.8 per cent, lifted by higher prices of commodities such as iron ore and crude oil. Japan's Nikkei advanced 1.4 per cent with technology companies boosted by a surge in their US peers. "Investors who were already excited about the U.S. chip sector's earnings the day before got even more reassured after they saw how their stocks moved," said Shogo Maekawa, a global market strategist at JPMorgan Asset Management. Maekawa added that a recovery in the global cyclical chip sector is taken as a silver-lining amid concerns about a global economic slowdown. A synchronised global economic slowdown is underway and any escalation in the US-China trade war would trigger a sharper downturn, according to the latest Reuters polls of hundreds of economists from around the world. "Equities may be drawing some support but the markets are bracing for next week's events," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management. "The US-China trade discussions will provide insight into how talks are progressing, while the British parliamentary voting is a key Brexit event. And there is also the FOMC (Federal Open Market Committee) meeting." Chinese Vice Premier Liu He will visit the United States on January 30 and 31 for the next round of trade negotiations with Washington. The two sides are "miles and miles" from resolving trade issues but there is a fair chance they will get a deal, US Commerce Secretary Wilbur Ross said on Thursday. The British parliament will debate and vote on Prime Minister Theresa May's Brexit "plan B" on January 29, and the US Federal Reserve concludes a two-day policy setting meeting on January 30. The Nasdaq had risen roughly 0.7 per cent on Thursday thanks to a rally by chipmakers, while the S&P 500 edged higher and the Dow closed nominally lower as anxiety about slowing global growth and the Sino-U.S. trade dispute undercut a spate of strong earnings. In currency markets, the euro was a shade firmer at $1.1316 but still in close reach of a six-week trough of $1.1289 plumbed overnight. The euro was down 0.4 per cent this week. The single currency slid after ECB President Draghi acknowledged on Thursday that economic growth in the euro zone was likely to be weaker than earlier expected due to the fall-out from factors ranging from China's slowdown to Brexit. Germany has dropped its economic growth forecast for 2019 to 1.0 per cent from 1.8 per cent due to slower global economic growth and uncertainty about Britain's exit from the European Union, the Handelsblatt newspaper reported on Thursday. The ECB had left its policy stance unchanged as expected on Thursday and Draghi's downbeat comments added to speculation that the central bank will hold back on interest rate hikes that some market watchers had expected in October. The pound was up 0.4 per cent at $1.3109 after brushing a two-month high of $1.3130, lifted after The Sun reported on Thursday that Northern Ireland's Democratic Unionist Party has privately decided to back Prime Minister May's Brexit deal next week if it includes a clear time limit to the Irish backstop. The dollar nudged up 0.1 per cent to 109.74 yen and on track to end the week little changed. The benchmark 10-year US Treasury note yield was slightly higher at 2.724 per cent after dropping to a one-week low as concerns over slowing global growth supported safe-haven government debt. Crude oil extended gains after rallying the previous day as the United States threatened sanctions on Venezuela's crude exports as the country descended further into political and economic turmoil. US crude oil futures were up 1.3 per cent at $53.82 per barrel after gaining 1 per cent on Thursday.

Asia stocks firm, euro sags after dovish ECB

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