(MENAFN- The Peninsula) The European Central Bank stands ready to use additional unconventional tools and tweak its existing efforts to spur inflation and growth in the euro zone if needed, ECB President Mario Draghi said yesterday.
Speaking to the economic and monetary affairs committee of the European parliament, Draghi also said he expects more demand from banks for its new ultra-long loan program, known as TLTROs, when the funding is offered again in December.
Lower than expected take-up of the initial tranche of loans last week has fueled expectations the ECB may eventually take more radical stimulus measures, such as buying large amounts of sovereign debt in a policy known as quantitative easing or QE.
Such a step would face strong resistance in Germany. Draghi said the euro zone central bank's Governing Council "remains fully determined to counter risks to the medium-term outlook for inflation".
"Therefore, we stand ready to use additional unconventional instruments within our mandate, and alter the size and/or the composition of our unconventional interventions should it become necessary to further address risks of a too prolonged period of low inflation," Draghi said.
The ECB would closely monitor risks to inflation, he added.
He said the ‚¬82.6bn taken by 255 banks last Thursday was "within the range of take-up values we had expected" and noted that banks will have another opportunity to use up their TLTRO initial allowance in December.
"By design, the September and December operations should be assessed in combination," Draghi said, adding that news of the TLTRO program had already had a "positive impact on financial market sentiment".
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.