QE longer if needed says Draghi

(ANSA) - Rome, September 3 - The bond buying of quantitative easing "is planned until September 2016 or even longer if necessary," ECB chief Mario Draghi said Thursday, stressing the need to fully implement the asset-buying programme.
    The ECB has decided to increase the share limit on its public-sector purchase programme from 25% to 33%, Draghi said. That means the ECB could buy more of a single asset, addressing fears that it might run out of bonds to buy.
    The governing council on Thursday also decided to keep the key ECB interest rates unchanged, leaving the rate at 0.05%.
    The economic recovery will continue but at a slower rate than previously forecast, Draghi said.
    The ECB lowered its growth and inflation forecasts.
    It lowered its growth forecasts for the eurozone from +1.5% to +1.4% for this year and from 1.9% to 1.7% for next. It also lowered its eurozone inflation forecasts from 0.3% to 0.1% for this year, from 1.5% to 1.1% for 2016 and from 1.8% to 1.7% for 2017.
    Draghi said that "we could see negative numbers for inflation in the next few months but the ECB considers them transient because of low oil prices".
    He said "available information indicates a slower increase in inflation compared to previous forecasts". It was still "premature", however, to say whether developments in oil prices "will have a lasting impact on prices".
    The ECB is "ready to use all available instruments within its mandate" to address changes in inflation prospects, Draghi said.
    Draghi said a 'bail-in' for Greece would have been counterproductive and the ECB argued against it at Eurogroup meetings. He said the ECB has "evidence our monetary policy works", citing improved credit in countries under economic stress such as Spain and Italy.
    Turning to China, Draghi said the country "has affirmed a commitment that it made at the G20 regarding exchange rates and the Chinese government must continue to implement reforms to ensure the convertibility of its currency," adding that the issue will be addressed at the next G20.
    "We are observing a weakening of the prospects for the Chinese economy," he said, which he explained results in two effects: one on "trade channels, which weakens the economies of other countries, and one "on confidence" which affects stock markets.
    Thursday was Draghi's 68th birthday.