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ECB confirms trillion-euro stimulus plan

A MASSIVE flood of money is to hit the European economy after the European Central Bank (ECB) confirmed it will launch a €1.1 trillion stimulus package from March.

The ECB wants to kick-start the flagging Eurozone, which entered deflation - a fall in the general level of prices - in December.

Falling prices encourage consumers to hold on to their money in the hope that goods and services will keep getting cheaper, so the ECB wants to stop the rot quickly and protect the Eurozone's fragile economic growth.

The plan will see the ECB buy corporate and government bonds to try and inject more cash into the system and get people spending.

"The combined monthly purchases of public and private sector securities will amount to €60bn," ECB president Mario Draghi told a news conference yesterday.

"They are intended to be carried out until the end of September 2016 and will in any case be conducted until we see a sustained adjustment in the path of inflation."

The euro plummeted towards an 11-year low after the announcement, which is good news for Irish exporters as our goods will be cheaper to buy in the US and the UK - two of our major trading partners.

The move is likely to push up house prices.

"The banks will have put that money to work and much of that will go into mortgage lending, so there would naturally mean more people will have the ability to buy houses pushing demand up," said John McCartney, head of research at property broker Savills.

British families are buying individual properties in Ireland as they take advantage of the favourable exchange rate between sterling and the euro, he added.