ECB Draghi Says Bank Will Keep Loose Policy For Longer

The European Central Bank will keep monetary policy loose for as long as it takes to push ultra-low inflation in the euro zone back up closer to the two percent level, its president Mario Draghi said on Wednesday.

With data showing the single currency zone’s economy having ground to a halt in the second quarter, Draghi told French radio the ECB would do all in its power to stimulate growth but reaffirmed that euro zone countries needed to make their economies fitter.

“Monetary policy will remain accommodative for a long time and I can tell you that the (ECB) Governing Council is unanimous in committing itself to using the tools at its disposal to bring inflation back to just under two percent,” Draghi, speaking through an interpreter, told Europe 1 radio.

Read MoreDraghi gets agrilling, defends cheap loan program

Referring to signs of growth elsewhere in the world economy, he said ECB policy would remain accommodative even “while other countries’ monetary policy may gradually acknowledge recovery is taking place”.

Draghi has in recent days signaled the bank was ready to use additional unconventional tools to spur inflation and growth. He gave no information of these, but noted: “Interest rates will remain low because they can’t get much lower.”

via CNBC

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza