ECB Going Through a 'More Cowbell' Scenario, SGH CEO Ghahramani Says

The video discusses the collapse of inflation expectations and evaluates two policy options: deeper negative interest rates and bond purchase programs. Negative rates have mixed effects, particularly harming banks but impacting currency values. The ECB's 2014 move to negative rates aimed to devalue the euro, benefiting exporters like Germany. However, the ECB now faces limited options, with asset purchases offering some potential but constrained by limited resources.

In what ways might asset purchases impact the real economy?

What challenges does the ECB face regarding its monetary policy options?