Draghi says ECB may buy State bonds, update 2

Central bank to evaluate sovereign bond purchases, markets rise

(ANSA) - Rome, January 8 - European Central Bank President Mario Draghi said in a letter released Thursday that the ECB will seriously evaluate the possibility of quantitative easing "at the beginning of the year".
    In a written response to a question from a member of the European Parliament, Draghi said the central bank will look "the purchase of various assets, including sovereign bonds".
    Draghi has recently been dropping hints that the bank is considering QE to try to encourage growth in the eurozone economy.
    It has become so weak that policy makers fear it could fall into deflation.
    Data released on Wednesday showed that was a possibility as preliminary eurozone statistics showed the economy may have slipped into the negative in December, well below the ECB's target rate of 2% inflation.
    The Milan stock exchange responded positively to Draghi's writing, gaining 3.43% by late afternoon to reach 18,745 points.