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ECB staff told to prepare further measures for use "if needed": Draghi

Thursday, November 6, 2014 - 22:16
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The European Central Bank is ready to use further unconventional policy tools if needed to stave off the risk of deflation and has asked staff to prepare them for use "if needed", ECB President Mario Draghi said on Thursday.

[FRANKFURT] The European Central Bank is ready to use further unconventional policy tools if needed to stave off the risk of deflation and has asked staff to prepare them for use "if needed", ECB President Mario Draghi said on Thursday.

Eurozone inflation ticked up to 0.4 per cent in October but remains far below the ECB's target of just under 2 per cent. The persistently low rate underscores the difficulty of hitting that target in a stagnating economy.

The ECB has launched a series of policies to boost the economy and inflation but Mr Draghi said there was a willingness to do more if necessary.

"The Governing Council has tasked ECB staff and the relevant Eurosystem (central bank) committees with ensuring the timely preparation of further measures to be implemented if needed," Mr Draghi told his monthly news conference after the ECB left interest rates at record lows.

Weak demand in September for the ECB's first offering of new long-term loans to banks, part of a plan aimed at fostering lending to companies, has raised expectations the ECB will eventually have to embark on further stimulus measures.

"He's still suggesting that QE is still on the table," said Hantec Markets analyst Richard Perry, referring to quantitative easing or money printing to buy assets.

REUTERS