ECB's Draghi: Risk of disinflationary expectations taking hold

FXStreet (Łódź) - ECB president Mario Draghi, who is delivering the introductory speech at the Forum on Central Banking organized by the ECB in Sintra, Portugal says that the low HICP in the Eurozone is due to the rise in the euro exchange rate.

• Draghi assures that the central bank isn't resigned to allowing excessively low inflation for too long.

• “The ECB must be particularly watchful for a negative inflationary spiral.”

• Broad based asset purchases could be implemented should inflation expectations weaken.

• Conventional monetary policy tools would have to be adjusted in case of an unwarranted tightening of monetary conditions from FX or market developments.

• The recovery in distressed EU Member States is dampened by low availability of credit, Draghi emphasizes.