ECB official warns of deflation risk; urges action on bond buying

Berlin

THE risk of deflation in the eurozone should not be underestimated and the best way for the European Central Bank (ECB) to deal with the problem is buying government bonds, Italy's central bank chief was quoted on Sunday as saying.

Ignazio Visco, who sits on the ECB's Governing Council, made the comments as the policymakers consider printing money to buy sovereign debt - so-called quantitative easing - to prevent the eurozone from slipping into a deflationary spiral.