Mario Draghi is at the mic again. Yesterday, the topic was regulation. Today he is taking the opportunity to express concern about the global economy.
Speaking in Brussels (and you can see the full text here, the European Central Bank president said:
Downside risks stemming from global growth and trade are clearly visible. Moreover, inflation dynamics have somewhat weakened, mainly due to lower oil prices and the delayed effects of the stronger euro exchange rate seen earlier in the year. In addition, price pressures – such as from producer prices – remain very subdued. Signs of a sustained turnaround in core inflation have somewhat weakened.
In line with his usual tone, Mr Draghi said the central bank is not going to sit idly by. (Our highlights.)
If we were to conclude that our medium-term price stability objective is at risk, we would act by using all the instruments available within our mandate to ensure that an appropriate degree of monetary accommodation is maintained. Consistent with our forward guidance, the asset purchase programme is considered to be a particularly powerful and flexible instrument. In fact, we have always said that our purchases would run beyond end-September 2016 in case we do not see a sustained adjustment in the path of inflation that is consistent with our aim of achieving inflation rates below, but close to, 2% over the medium term. Other instruments could also be activated to strengthen the impact of the purchase programme if necessary.
Mr Draghi also stressed the importance for the central bank of meeting with market participants
Let me be very clear: whatever the date, we have had and still have a clear rule – we do not discuss market-sensitive information in non-public meetings.
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