Key quotes from ECB head Draghi’s press briefing
Jun 6, 2013, 3:47 PM
FRANKFURT, Germany (AP) – At his monthly news conference following the European Central Bank’s policy-setting meeting, President Mario Draghi on Thursday answered questions from reporters.
Here are some highlights of the things he said:
_ INTEREST RATES
The ECB’s governing council kept its key refinancing rate at the record low of 0.5 percent. Draghi said some of the economic indicators had improved and others had worsened.
“By and large the governing council agreed that there wasn’t any directional change that would justify taking action at this point in time.”
Looking ahead: “Our monetary policy stance will remain accommodative for as long as necessary.”
_ ECONOMIC GROWTH
The ECB lowered its forecast for economic growth in the 17-country eurozone this year but increased it for next year.
“Euro area economic activity should stabilize and recover in the course of the year, albeit at a subdued pace.”
_ INFLATION
Inflation in the eurozone is at 1.4 percent, below the ECB’s target of close to, but below 2 percent. Draghi suggested it will remain tame.
“The underlying price pressure over the medium term is expected to remain subdued, reflecting low capacity utilization and a modest pace of economic recovery.”
_ GLOBAL CENTRAL BANKS
Some economists say that the actions of global central banks are causing volatility in financial markets. The Bank of Japan has this year caused a huge rally in its national stock market and a sharp drop in its currency by announcing a massive monetary stimulus program. Meanwhile, hints by Federal Reserve officials that the U.S. central bank may consider decreasing its own stimulus program have caused big drops in global stock markets.
Draghi suggested the ECB was not contributing to these market movements.
“What’s happening in the rest of the world is producing consequences on volatility.”
_ GREEK BAILOUT
The International Monetary Fund this week criticized the handling of Greece’s bailout by itself, the ECB and the EU Commission. In a report, it said that the three organizations had underestimated the severity of the recession that would be caused by the debt reduction measures they demanded of Athens.
Draghi was asked if the ECB should also admit it had made mistakes.
“Not really.”
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