Mario Draghi warned that the European Central Bank’s newest stimulus push might not be the last as it strives to reach its inflation goal.
“The intention of the monetary-policy decisions is to maintain the extraordinary degree of accommodation in place,” the ECB president told reporters in Frankfurt after the Governing Council agreed to add 540 billion euros ($576 billion) to its bond-buying program and extend it until the end of next year. If “the outlook becomes less favorable or financial conditions become inconsistent with further inflation progress, the Governing Council intends to increase the program in size or duration.”
The ECB’s fresh action comes amid concern that the euro area’s gradual economic recovery risks being derailed as political uncertainties cloud the outlook. Draghi and his colleagues have frequently stressed that the upturn is largely reliant on continued monetary easing as governments fail to play their part with economic reforms.
Source: Bloomberg (8th December 2016)