Europe’s stock markets surged Tuesday after European Central Bank chief Mario Draghi hinted at further eurozone interest rate cuts, on the eve of a key US monetary policy decision.
In midday deals, London stocks added 0.8 percent, while Paris soared 1.5 percent and Frankfurt leapt 1.2 percent in value in early afternoon trade.
“Super Mario is back!” said IG analyst Chris Beauchamp in summary at the markets action.
“Despite only having a few months left to his tenure, the head of the ECB has handed his successor a firmly dovish bias, as he leaves the door open to more QE (quantitative easing stimulus) and renewed negative rates at the ECB in order to try once again to kick-start the eurozone economy.”
Markets reacted strongly after ECB boss Draghi’s renewed openness to lowering interest rates still further, as well as other steps to boost the bloc’s anaemic growth and inflation.
“Further cuts in policy interest rates and mitigating measures to contain any side effects remain part of our tools,” Draghi told the ECB’s annual economics gathering in Sintra, Portugal.
