ECB's Draghi sees insufficient inflation progress

FILE PHOTO - European Central Bank (ECB) President Mario Draghi waits to address the European Parliament's Economic and Monetary Affairs Committee in Brussels, Belgium September 25, 2017. REUTERS/Francois Lenoir

WASHINGTON (Reuters) - The euro zone continues to need substantial monetary stimulus as the European Central Bank has not yet managed to increase inflation sufficiently, ECB President Mario Draghi said on Friday.

“Progress towards a durable and self-sustaining convergence of inflation towards our objective is not yet sufficiently convincing,” Draghi said in a statement to the International Monetary and Financial Committee in Washington.

His statement was broadly in line with the bank’s stance at its September policy meeting.

“Thus, a very substantial degree of monetary accommodation is still needed,” Draghi said.

The ECB is due to decide in October whether to extend its stimulus programme into next year. Sources told Reuters on Friday that the bank is likely to reduce support but extend asset purchases to signal an extended period of support.

Reporting by Balazs Koranyi; Editing by Paul Simao