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IMF urges ECB to use all tools to support eurozone

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The International Monetary Fund welcomed moves announced by the European Central Bank on Thursday to support the eurozone, and urged it to use its entire toolbox to spur growth.

[WASHINGTON] The International Monetary Fund welcomed moves announced by the European Central Bank on Thursday to support the eurozone, and urged it to use its entire toolbox to spur growth.

"The ECB should continue to strongly signal its willingness to act and use all the instruments available until its price stability mandate is met," IMF spokesman Gerry Rice said at a regularly scheduled news conference.

The ECB extended its quantitative easing asset-purchases program by at least six months and broadened the types of bonds it would buy. It also lowered its key deposit rate by 1/10th point to minus 0.3 per cent.

The IMF applauded the ECB decisions which, according to Rice, "will help address increased downside risks to the recovery" in the 19-nation currency bloc.

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The ECB asset-purchase programme "has supported confidence, financial conditions, and inflation expectations," he said.

ECB President Mario Draghi, speaking at a news conference following the monetary policy meeting, said the ECB was ready to step up measures if the "external conditions put at risk achievement of our objective." Eurozone inflation was unchanged at 0.1 per cent in November, well below the ECB rate target of below, but close, to 2.0 per cent.

AFP

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