Sunday, 24 March, 2019

ECB says determined to prevent too low inflation

A huge Euro logo is pictured past the headquarters of the European Central Bank (ECB) in Frankfurt,   September 29,   2011. REUTERS/Ralph Orlowski/FilesBy Eva Taylor and Sakari Suoninen FRANKFURT (Reuters) – The European Central Bank said on Thursday it was determined to use all available tools to prevent inflation falling too low, but left interest rates unchanged despite price rises slowing further into a "danger zone" below 1 percent. ECB President Mario Draghi told a news conference after a monthly rate-setting meeting that the 18-nation euro zone may experience a prolonged period of low inflation before a gradual return to the ECB's target level of just below 2 percent. The central bank, which last shaved its main rate to 0.25 percent in November, "strongly emphasised" its willingness to act boldly if needed to prevent any slide towards deflation – a term it rejected – but left itself more time to assess price and money market trends. He acknowledged this was a more strongly worded expression than in the past of intent to act if money market interest rates rose too far or there was a further fall in the bank's inflation outlook.

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