Davos, Switzerland: Financial markets have been obsessing for months about the timing, size and structure of a European Central Bank bond-buying programme that seems likely to be unveiled today.
But business leaders, policymakers and celebrity academics gathered at the World Economic Forum in Davos had a message for all the “quantitative easing” (QE) enthusiasts: don’t count on the ECB to resolve Europe’s economic woes.
On the first day of the annual gathering in the Swiss Alps, former Bundesbank president Axel Weber, now chairman of Swiss bank UBS, raised questions about whether the single currency could survive unless politicians stepped up and reformed their economies.
“I have not seen enough reforms in Europe and the ECB will not fix this issue,” Weber said, stressing the need for “heavy lifting” changes to labour market rules and pension schemes.
He said that if European politicians continued to rely on loose monetary policy alone, the euro project would become “increasingly difficult” to run.
“We need to move Europe to that next stage and if that doesn’t happen I think there will always be questions about the viability of the project. Europe has not done enough to dispel these concerns,” he said.
Full article: A Message From Davos: Quantitative Easing Alone Won’t Solve Europe’s Ills (NDTV)