Reuters are reporting that Cheap European Central Bank (ECB) loans will not be sufficient on their own to boost corporate borrowing and investment while demand in many markets remains subdued. This announcement comes from the finance chief of Germany's HeidelbergCement.
ECB chief Mario Draghi recently unveiled a bold package of measures, cutting interest rates, expanding asset purchases and launching a fresh round of super cheap loans, aiming to launch growth and stave off the threat of deflation.
HeidelbergCement has no plans to change its borrowing plans in response to even cheaper funding.
Germans have been the biggest sceptics of ultra loose ECB policies as German banks are already full with liquidity, unlike rivals in southern countries, and the biggest impediment to growth has been weak demand, not the lack of funding.
LafargeHolcim has announced that it expected the cement market to grow a modest 2-4% this year, with China and Brazil remaining tough places for business.
HeidelbergCement announced earlier that it planned to keep capital investment steady this year at €1.1 billion (US$1.2 billion).
HeidelbergCement has struggled to reduce its debt-to-profit ratio since the financial crisis, and has finally reached a level it hopes will win it an investment-grade credit rating.
Edited from source by Joseph Green. Source: Reuters