BNR Nieuwradio’s Economenpanel forecasts and discusses the plans of the ECB
In BNR Nieuwradio’s Economenpanel of 9 September 2019, Sandra Phlippen, Assistant Professor at Erasmus School of Economics and Head for the Netherlands at ABN Amro’s Group Economics, discusses, together with Edin Mujagic (OHV Vermogensbeheer) and Menno Middeldorp (Rabobank), among others the possible interest rate cut and further decisions by the ECB.
According to Phlippen, it is not that exiting what will happen to the interest rate. ‘It can be expected that there will be an interest rate cut.’ Much more interesting is the possible restart of the purchase programme. ‘In this respect, the speech given by Christine Lagarde last week is informative. In it, she gives a bit of a glimpse of what she think is important, as the new ECB President. So, I found it particularly remarkable that she is actually leading the way towards a kind of second goal alongside price stability, and that is to keep an eye on sustainability when purchasing bonds. That would mean a very big change compared to how things are now.’
‘This emphasis would be justified when it becomes apparent that not helping to steer climate change through the purchase programme is endangering financial stability,’ says Phlippen. ‘The literature, that states that there is a correlation between the energy transition and financial stability, is growing. But I think it is remarkably early that she is already talking about it.’