Highlights from Draghi's Q&A

Draghi noted the constraints in the bond buying program but underscored the ECB's determination to hit targets. However, he didn't offer any details whatsoever on what they might do or change to get there.

So it's something like "We don't know exactly how we're going to hit our targets but, trust us, we'll get there."

The market wanted/expected a bit more in the way of details.

  • Probability of deflation has not increased
  • ECB stands ready to act if second round effects arise

Draghi was also asked about the effectiveness of ECB programs and defended them, taking credit for tighter spreads. "Fragmentation is over," he said. "ECB policy has been very effective."

  • Risk aversion is no longer a factor in lending
  • Competition is driving lending