FRANKFURT (Reuters) - The European Central Bank held its main interest rate at 0.75 percent on Thursday, deferring any cut in borrowing costs while it assesses the extent of the euro zone’s economic downturn and waits for a cue to use its new bond-purchase programme.
Following are comments by ECB President Mario Draghi at a news conference after the meeting.
“We always discuss all instruments of monetary policy, but the Governing Council decided ... to keep interest rates unchanged. We have not discussed what we are going to do next year.”
”Owing to high energy prices and increases in indirect taxes in some euro area countries, inflation is likely to remain above 2 percent for the remainder of 2012.
”They are expected to fall below that level in the course of next year and to remain in line with price stability over the policy horizon.
”The underlying pace of monetary expansion continues to be subdued.
“Inflation expectations for the euro area remain firmly anchored in line with our aim of maintaining inflation rates below but close to 2 percent over the medium term.”
READY TO START OMTs
“We are ready to undertake OMTs which will help to avoid extreme scenarios, thereby clearly reducing concerns about the materialization of destructive forces.”
“Economic activity in the euro area is expected to remain weak although it continues to be supported by our monetary policy stance and financial market confidence has visibly improved on the back of our decisions as regards Outright Monetary Transactions.”
London Desk +44 207 542 4441