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ECB: No monetary policy change

June 25, 2013

The European Central Bank (ECB) has defended its crisis management policies. It said it would continue its accommodative monetary strategy for some time to come despite criticism from some eurozone leaders.

https://p.dw.com/p/18vkn
Mario Draghi, President of the European Central Bank (ECB) REUTERS/Kai Pfaffenbach (GERMANY - Tags: BUSINESS)
Image: REUTERS

ECB President Mario Draghi said Tuesday that he ruled out an early exit from the bank's accommodative monetary policies while recession in the eurozone was still lingering on.

"In terms of monetary policy, price stability is assured and the overall economic outlook still warrants an accommodative stance," Draghi told an economic forum of German Chancellor Angela Merkel's Christian Democrats in Berlin.

Pointing to continuously low inflation and high unemployment in the euro area, he said there would be no major policy change in the foreseeable future.

Draghi in particular defended the ECB's rolling out of cheap loans and trimming interest rates to a record low of 0.5 percent.

Fed sticks to stimulus

ECB versus Fed

The ECB chief's comments came after a recent round of market turmoil triggered by signals from the US Federal Reserve that it was considering scaling back its quantitative easing stimulus program, should developments on the domestic labor market speak in favor of such a move.

Also on Tuesday, ECB executive board member Benoit Coeure said in London the ECB's current monetary policy would "stay in place as long as necessary."

Several German leaders had been worried about the central bank's bond-buying program known as Outright Monetary Transactions (OMT), which they argued placed at risk the bank's independence and threatened to stoke inflationary pressures. OMT has so far not been activated and is currently facing a challenge in Germany's Constitutional Court in Karlsruhe.

hg/slk (Reuters, dpa)