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As the recession fears to grow in Europe, the central bank is increasing signals




By effectively committing the central bank to action as soon as the next monetary policy meeting on July 25, Mr. Draghi may have been reassuring on the financial markets that economic stimulus will last long after he leaves the office.

His words could be seen as a form of preventive strike if his successor turns out to be conservative as Jens Weidmann, a member of the Governing Council of Germany, who is considered a leading candidate. Mr. Weidmann, who was in the audience on Tuesday, is seen as being less willing to aggressively fight a slowdown.

The comments on Tuesday "can catch Draghi's potential successor on a website with relief," said Bart Hordijk, analyst at Monex Europe, a foreign exchange firm, said in a statement. "Even a more hawkish new E.C.B president must take some time to loosen himself before further tightening can even be put on the agenda again."

Mr. Draghi has not told the public who he believes should succeed with him, but he indicated his opposition to Mr. Weidmann, whom he has had a tense relationship with.

Herr. Draghi suggested on Tuesday that Mr. Weidmann's criticism of European central bank policy had helped to burn populism. In 2013, Weidmann, who is also the president of the Bundesbank, the German central bank, witnesses in Germany's constitutional court to support euro opponents who had filed a case to block the bond purchase program.

Without mentioning Mr. Weidmann by name, Mr. draghi said that when national central banks supported European central bank policies, they helped to gain popular acceptance for the stimulus measures. "When this didn't happen, you saw the opposite," said Mr. Draghi during the panel discussion. "They actually traveled populism."

In December, the European Central Bank stopped adding treasury and corporate bonds, which it had bought in large quantities to push down market rates. But in March, when Mr. Trump's trade war disturbed the global economy, the European Central Bank showed signs of having other thoughts and reviving a program that would encourage banks to lend more to businesses and consumers as a means of preventing a recession. 19659008]



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