ECB'S Nowotny sees no further deposit rate cut

VIENNA (Reuters) - A further cut in the European Central Bank's deposit rate below zero would likely have little effect, ECB policymaker Ewald Nowotny said on Monday.

"A further lowering of the deposit rate, in my view, would not have much effect," Nowotny told a news conference in Vienna.

"Frankly speaking, I think that at this level of zero it is not really a matter of economic perspectives whether you use the deposit rate, but more a question of general risk aversion that you do have in the market."

Asked whether the ECB should have cut its main interest rate by more when it lowered the rate by 0.25 percentage points to 0.75 percent last week, he answered: "I believe it's important and good for a central bank... not to use all its firepower at once."

Nowotny added that the ECB should not be distracted by its new European bank supervision duties, details of which he said would be worked out next year after the groundwork had been done by politicians.

"There must be a clear division between monetary policy on the one hand and supervision on the other. The ECB's monetary policy scope for action must on no account be limited by this responsibility," he said.

(Reporting by Georgina Prodhan and Angelika Gruber; Editing by Toby Chopra)