Published March 07, 2013
FRANKFURT – The European Central Bank kept interest rates steady at a policy meeting on Thursday. Following are comments by ECB President Mario Draghi at a news conference after the meeting.
CRITERIA FOR OMT ACCESS
"Countries should be in the market by themselves ... being able to issue (debt) along the yield curve ... to a fairly broad category of investors ... (in) certain quantities."
"The OMT has never been meant to help return countries to the market."
NOTHING SPECIAL PLANNED TO AID SMEs
"No, we are not at this point in time ... committing or planning anything special," Draghi said when asked about possible moves to boost lending to SMEs, including potential changes to collateral rules.
"The large companies, by and large, have no problem in financing and funding themselves; SMEs do."
ECB'S ROLE IN TROIKA
"The troika functions very well ... The troika has to look at the whole of Europe, and we believe that the ECB has some value-added and some specific competence in the sector of its competence, namely the financial sector."
MIXED DATA PICTURE
"We are actually seeing a dichotomy between the hard data, which as you said a moment ago are on average disappointing, and a broad indicator of soft data, of survey data, of sentiment data, which almost uniformly are positive."
BOND BUYING PLAN REMAINS IN PLACE
"On OMT, I mean the rules of OMT are what they are. So we will see, and it is not in our capacity. The ball is entirely with the governments; I have seen this on and on and on. OMT remains, is in place. It is a very effective backstop, and it is there. But you know the rules."
ASKED ABOUT POSSIBLE RATE CUT
"We have discussed the possibility of doing it. So there was discussion. The prevailing consensus was to leave the rates unchanged."
"The (economic) recovery path is by and large unchanged and the inflation projection in line with our medium-term policy objectives."
ON ITALY'S ELECTIONS
"Markets after some excitement immediately after the elections have now reverted back, more or less, to what they were before ...
"Markets understand that we live in democracies."
"We have many signs that confidence to financial markets of the euro area is returning.
"If I have to use a word which I used in the past, namely, contagion - by the way I saw that it has been misinterpreted. I meant contagion between financial markets, not when I spoke about positive contagion. Not positive contagion from the financial markets to the real economy, where I have always been very careful in explaining that we are actually lagging on that.
"But if we look at contagion, you have seen certainly that the contagion to other countries has been muted this time, contrary to what might've happened about a year and a half ago. And this is another positive sign."
"Risks to the outlook for price developments continue to be seen as broadly balanced over the medium term.
"Underlying price pressures should remain contained, given the environment of weak economic activity in the euro area."
DOWNSIDE ECONOMIC RISKS
"The Governing Council continues to see downside risks surrounding the economic outlook for the euro area.
"A gradual (economic) recovery should commence in the second part (of 2013)."
FULL ALLOTMENT OF LIQUIDITY
"Our monetary policy stance will remain accommodative with the full allotment mode of liquidity provision."
CLOSELY MONITORING MONEY MARKETS
"We are closely monitoring conditions in the money markets, and their potential impact on the stance of monetary policy and the functioning of our transmission of our monetary policy to the economy."
"These repayments reflect improvements in financial market confidence over the last few months and receding financial market fragmentation."
"Necessary balance sheet adjustments in the public and private sectors will continue to weigh on economic activity. Later in 2013, economic activity should gradually recover, supported by a strengthening of global demand and our accommodative monetary policy stance."
"Inflation expectations for the euro area remain firmly anchored, in line with our aim of maintaining inflation rates below but close to 2 percent over the medium term. Overall, this will allow our monetary policy stance to remain accommodative."
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