BERLIN, March 9 The European Central Bank should
on Thursday prepare the ground for an exit from its ultra-loose
monetary policy, a German banking association said as the
central bank gathered for a policy meeting.
The BdB private banking association said the fact that the
threat of deflation has disappeared in the euro zone and
inflation was picking up justified its recommendation.
"Such a step must be prepared very, very well" and
policymakers should communicate it carefully, BdB head Michael
Kemmer told Deutschlandfunk radio on Thursday.
"But it would be important, I think, that the ECB today
opens the door to the exit (of its expansive monetary policy),"
The comment was the second on the topic by the BdB this
week. The association said on Monday that the upswing in the
euro zone economy meant the ultra-expansive policy was no longer
The ECB is on Thursday expected to resist calls to tighten
policy as it casts a cautious eye ahead to high-risk elections
in the Netherlands and France during an upsurge in populist,
Germany is heading towards a tightly contested federal
election of its own in September, and senior politicians there
have repeatedly urged the ECB to start unwinding its
But in rare praise of the central bank, Finance Minister
Wolfgang Schaeuble said on Tuesday that the ECB was doing a good
job in pursuing a policy that met the diverse needs of the euro
zone's 19 member countries.
The ECB is expected to say on Thursday that underlying price
growth remains weak and the economic recovery is still fragile.
(Reporting by Thomas Seythal; Writing by Michael Nienaber;
editing by John Stonestreet)