Sentences with phrase «threat of deflation»

Launched three years ago to fight off the threat of deflation, the ECB's 2.55 trillion euro ($ 3.14 trillion) bond purchase programme has kept borrowing costs low to induce spending and investment, all with the ultimate aim of generating inflation.

While that might be reasonable in an environment of stronger global growth, «it is, perhaps, not a multiple appropriate for a sloppy expansion in the U.S. and threats of deflation and recession elsewhere,» Colas said.

William Bernstein commented at the recent Bogleheads Conference that the threat of deflation has all but disappeared in the fiat money era.

One of the scenarios that the Permanent Portfolio guards against is deflation... the threat of deflation has all but disappeared in the fiat money era.

Nevertheless, the apparent success of the ECB's policy in overcoming the threat of deflation increased speculation about a potential tightening of monetary policy, possibly even before the cessation of the central bank's bond purchases — scheduled to continue for at least the rest of the year — and in the wake of the ECB meeting pushed market estimates of the odds of a rise in official interest rates before the end of 2017 to more than 50 %.

The idea is that once the Federal Funds rate has reached zero, the threat of deflation could lead to real interest rates rising above zero, which in the current economic situation is deemed bad.