E.C.B. Move Leaves Further Stimulus Up to Eurozone Politicians

Mario Draghi, the European Central Bank president, said Thursday that the governing council agreed to a quantitative easing program that will see it buy up to 60 billion euros’ worth of bonds.

DAVOS, Switzerland — The European Central Bank deployed its most powerful weapon Thursday, saying that it would begin effectively printing money in a bid to jolt the eurozone out of an increasingly grave economic malaise.

While welcomed almost everywhere but Germany, the decision to begin buying 60 billion euros, or about $69.7 billion, a month of government bonds and other debt now puts the onus on fractious and unpopular leaders in many of the 19 countries in the euro currency union.

With the European Central Bank now stretched to the limits of its powers, any further economic stimulus steps would need to be by national leaders, if they deem it necessary to improve growth, reduce the bloc’s 11.5 percent unemployment rate and prevent a catastrophic decline of prices known as deflation.

Such steps would involve the sort of extensive government spending that many countries, including Germany, have been reluctant to pursue, hewing, instead, to a philosophy of budget discipline that has acquired the shorthand label of austerity. The German chancellor, Angela Merkel, on Thursday warned her peers not to waste the breathing space given them by the central bank.

The European Central Bank has sometimes seemed like the sole eurozone institution seeking to restore the economy, in the absence of government spending stimulus. In contrast to the stronger recoveries of the United States and Britain, the bloc’s gross domestic product has still not regained its levels before the onset of the financial crisis in 2007. Demand and credit demand remain feeble, and the unemployment rate has not dipped below 11 percent since early 2012.

Now that the European Central Bank is approaching the limit of its powers, eurozone leaders may feel more pressure to act. But most of the changes economists say are needed, such as loosening rules that make it harder for companies to fire unwanted workers, are unpopular with voters.

“It’s a difficult task,” Sigmar Gabriel, the German economics minister, said of economic reforms during a panel discussion. “Most governments that have gone through with it have lost the next elections. But there is no alternative.”

Reporting was contributed by David Jolly from Frankfurt, Niki Kitsantonis from Athens, and Jenny Anderson, Peter Eavis and Alison Smale from Davos, Switzerland.

The New York Times