Draghi: Easy-Money Exit Not Coming Anytime Soon
An exit from the European Central Bank's exceptional monetary policy measures remains distant, ECB President Mario Draghi reiterated on Wednesday, soothing unnerved markets after the U.S. Federal Reserve laid out a plan to reel in stimulus.
Speaking to committees in the French lower house of parliament, Draghi said there were still downside risks to growth in the euro zone economy and the ECB was ready to take fresh action if needed.
"On our policy stance, let me say that it's been accommodative in the past, it is accommodative in the present time and will stay accommodative for the foreseeable future," Draghi said.
"Our exit - as Benoit Coeure said a couple days ago - remains distant. At the same time we have an open mind about all other possible instruments that we may consider proper to adopt. ... we stand ready to act again when needed."
Draghi's comments stand in contrast to those made last Wednesday by Federal Reserve Chairman Ben Bernanke, who said the U.S. economy was expanding strongly enough for the central bank to begin slowing the pace of its bond-buying stimulus later this year.
On Tuesday, some of the world's top central bankers sought to calm markets about the impact of the Fed's plan.
But Draghi said the ECB could only do so much. On the eve of an EU summit on Thursday and Friday, he called on governments to push on with reforms and the planned European banking union.
"The ECB has done as much as it can to stabilise markets and support the economy," he said. "Now governments and parliaments need to do all they can to raise growth potential."
"Banking Union is essential to ensure that we make permanent the progress made in reintegrating financial markets," he said. "It has two indispensable elements: a strong Single Supervisory Mechanism (SSM) and a strong Single Resolution Mechanism (SRM)."