WASHINGTON, April 12 A further strengthening of
the euro exchange rate would require more loosening in the
European Central Bank's monetary policy to keep the overall
policy stance as accommodative as it is now, ECB President Mario
Draghi said on Saturday.
Draghi said that euro appreciation over the last year was an
important factor in bringing euro zone inflation down to its
current low levels, accounting for 0.4-0.5 percentage point of
decline in the annual rate, which stood at 0.5 percent
year-on-year in March.
"I have always said that the exchange rate is not a policy
target, but it is important for price stability and growth. And
now, what has happened over the last few months is that is has
become more and more important for price stability," Draghi said
at a news conference.
"So the strengthening of the exchange rate would require
further monetary policy accommodation. If you want policy to
remain accommodative as now, a further strengthening of the
exchange rate would require further stimulus," he said.
(Reporting By Jan Strupczewski and Krista Hughes)