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Draghi says willing to consider 'unconventional' instruments

Central bank holds rates unchanged despite falling inflation

03 April, 15:41
Draghi says willing to consider 'unconventional' instruments (ANSA) - Rome, April 3 - The European Central Bank (ECB) held its main interest rate steady on Thursday, while President Mario Draghi said that he would take whatever measures are needed to maintain price stability.

Draghi's pledge suggests the ECB is considering 'unconventional' measures that in other major countries has translated into buying government assets to help control interest rates.

The United States Federal Reserve calls the measures quantitative easing (QE), which has also been used by the Bank of Japan and the Bank of England.

Thursday's decision holds the ECB's main interest rate at a record low of 0.25%.

Draghi said the ECB stood ready to act if necessary on falling inflation.

"We will consider all instruments available to us," he said. "We are resolute in our determination to maintain a high degree of monetary accommodation and act swiftly if required," he added.

"The Governing Council is unanimous in its commitment to using...unconventional instruments within its mandate in order to cope effectively with risks of a too prolonged period of low inflation".

However, he said that he was not concerned by a fall in inflation seen across Europe, saying that did not necessary indicate a risk of deflation. "We don't see the risk of deflation as having increased," Draghi said during a news conference in Frankfurt.

Earlier this week, statistics showed that inflation reached its lowest rate in four years in March, at 0.5% - well below the ECB's target of 2% inflation.