FRANKFURT The European Central Bank pledged on Thursday to keep its aggressive stimulus policy at least until the end of the year, maintaining its support for the economy as anti-euro sentiment rises before elections in France and the Netherlands.
Following are highlights of ECB President Mario Draghi's comments at a press conference after the policy meeting.
EURO AND SINGLE MARKET
"The euro is seen as the prerequisite of the common market - if there is no euro, there is no single market."
SENTENCE REMOVED IN INTRO STATEMENT
"A sentence has been removed from the introductory statement: if warranted to achieve our objective, the Governing Council will use all the instruments at its disposal ... that sentence has been removed because the sense of urgency is not there."
LITTLE DEFLATION RISK
"I would say that the risks of deflation have largely disappeared. Market-based inflation expectations have increased noticeably."
ASSET PURCHASE PROGRAMME
"If the outlook becomes less favourable, or if financial conditions become inconsistent with further progress towards a sustained adjustment in the path of inflation, we stand ready to increase our asset purchase programme in terms of size and/or duration."
"Measures of underlying inflation, however, have remained low and are expected to rise only gradually over the medium term, supported by our monetary policy measures."
"The risks surrounding the euro area growth outlook have become less pronounced but remain tilted to the downside and relate predominantly to global factors."
"Underlying inflation pressures continue to remain subdued, the Governing Council will continue to look through changes in HICP inflation if judged to be transient and to 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."
RECOVERY GAINING MOMENTUM
"Sentiment indicators suggest that the cyclical recovery may be gaining momentum."
(EMEA MPG Desk)