European Central Bank President Mario Draghi said large-scale asset purchases are part of the central bank’s toolkit, but for now it would focus on its latest set of stimulus measures.
Draghi told Dutch newspaper De Telegraaf in an interview published on Saturday that the euro zone recovery was still weak, uneven and vulnerable and that interest rates would stay low over a longer period.
Asked what needed to happen before the ECB would start buying assets to give banks more money to lend, also known as quantitative easing, Draghi said “that would be the answer to a deterioration of inflation expectations over the medium term.”
“At the moment, however, we are focusing on the measures announced on 5 June,” Draghi was quoted as saying.
The ECB’s target for medium-term inflation is below, but close to 2 percent, a far cry from the current level of 0.5 percent, which has sparked concern the euro zone could enter a Japan-style deflationary spiral of falling prices, slowing growth and waning consumption and investments.
via CNBC
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