FRANKFURT, April 27 The European Central Bank
left its ultra-easy policy stance firmly in place on Thursday as
inflation continues to undershoot its target for a fifth
straight year, even as economic growth is on its best run since
the global financial crisis.
Following are highlights of ECB President Mario Draghi's
comments at a press conference after the policy meeting.
INFLATION ASSESSMENT UNALTERED
I don't think there is any need to discuss (sequencing of
policy changes) now. We have not seen sufficient evidence to
alter our assessment of the inflation outlook, and we are not
sufficiently confident that inflation will converge to levels
consistent with our inflation aim in a durable and
RECOVERY BECOMING INCREASINGLY SOLID
Incoming data since our meeting in early March confirm that
the cyclical recovery of the euro area economy is becoming
increasingly solid and that downside risks have diminished.
ON THE PROSPECT OF A MACRON PRESIDENCY IN FRANCE
In the Governing Council meetings we discuss policies, not
POST-IMF/WORLD BANK MEETING ASSESSMENT ON IMPACT OF TRUMP
It is premature to react or make policy decisions based on
the future policies pursued by the U.S. administration at this
point... One thing that may have come out of the meetings is
that perhaps the risk of trade protectionism may have somewhat
receded... Markets are in the course of a reassessment of the
U.S. fiscal policy and I frankly wouldn't feel like going beyond
ON REMOVING THE EASING BIAS IN INTEREST RATES
We didn't discuss it ... most of the discussion focused
really on the balance of risks concerning growth, not inflation.
Easing biases are actually linked to inflation -- in other
words, the easing biases are meant to cope with tail risks
concerning the inflation rate, not growth directly. It's quite
clear that as growth perspectives improve, the probability of
these tail risks may go down, but we are not there yet.
BANKING SECTOR RISK IN CONTEXT OF LOWER RISK TO GROWTH
All in all the (economic) improvements are there, have been
continuing, have been broadening but we still have many
fragilities one of which speaking of leverage is given by the
fragility in the banking sector and the NPL (non-performing
loan) stocks in many countries that could have a much higher
credit growth if it had not been for the NPLs.
Underlying inflation pressures continue to remain subdued
and have yet to show a convincing upward trend. Moreover, the
ongoing volatility in headline inflation underlines the need to
look through transient variations in HICP inflation which have
no implication for the medium-term outlook for price stability.
A very substantial degree of monetary accommodation is still
needed for underlying inflation pressures to build up and
support headline inflation in the medium-term.
In terms of my criteria the (inflation) assessment hasn't
The risks surrounding the euro area growth outlook, while
moving toward a more balanced configuration, are still tilted to
The ongoing economic expansion will continue to firm and
The signs of a stronger global recovery and increasing
global trade suggest that foreign demand should increasingly add
to the overall resilience of the economic expansion of the euro
(EMEA MPG Desk)