HIGHLIGHTS-Draghi comments at ECB news conference
FRANKFURT Dec 5 (Reuters) - The European Central Bank left interest rates unchanged on Thursday, pausing to assess the health of the euro zone recovery after taking action a month earlier in response to falling inflation, which is now abating.
Following are comments by ECB President Mario Draghi at a post-meeting news conference.
NEGATIVE DEPOSIT RATES
We have not identified, amongst the various numerous instruments we have, one specific instrument in the discussion we had today. We had a brief discussion about negative deposit rates, but it was brief.
If we are to do an operation similar to the LTRO, we're going to make sure this is being used for the economy.
And we'll make sure this operation is not going to be used for subsidising capital formation by the banking system in these carry trade operations.
MAKING FUTURE LTROs WORK
Lots of work, reflection, papers have been written on this. So when the time comes we are going to be ready... if this time will ever come.
Exchange rates ... are not a policy target... However, exchange rates are important for price stability, as we are seeing today, and for growth. So we will keep this into account in our monetary policy decisions.
The experience of what you are saying, unilateral forex intervention, is not contemplated by the current G20 agreements.
DOWNSIDE ECONOMIC RISKS
The risks surrounding the economic outlook for the euro area are assessed to be on the downside.
MONITORING MONEY MARKETS CLOSELY
We are monitoring (money market) developments closely and are ready to consider all available instruments.
FORWARD GUIDANCE CONFIRMED
The (ECB) confirmed its forward guidance that it continues to expect the key ECB interest rates to remain at present or lower levels for an extended period of time. This expectation continues to be based on an overall subdued outlook for inflation extending into the medium term.
PROLONGED LOW INFLATION
We may experience a prolonged period of low inflation, to be followed by a gradual upward movement towards inflation rates below, but close to, 2 percent later on.
(In) 2014 and 2015, output is expected to recover at a slow pace.
PRICE PRESSURES SUBDUED
Underlying price pressures in the euro area are expected to remain subdued over the medium term. In keeping with this picture, monetary and credit dynamics remain subdued.
The risks to the outlook for price developments are seen to be broadly balanced over the medium term.
DATA CONFIRMS RECENT POLICY DECISIONS
Incoming information and analyses have confirmed our assessment and monetary policy decisions of last month.
(EMEA MPG Desk, +44 207 542 4441)
- Malaysia Airlines plane missing at sea off Vietnam, presumed crashed |
- China draws 'red line' on North Korea, says won't allow war on peninsula
- Malaysian plane crashed off Vietnam coast: state media
- No signal picked up from missing Malaysia Airlines plane-Vietnam official