Draghi Says ECB Ready to Act to Maintain Monetary Accommodation

  • Draghi says at ECB cultural event that QE proceeding smoothly
  • Governing Council sees downside risks for growth and inflation

European Central Bank President Mario Draghi

Photographer: Martin Leissl/Bloomberg

European Central Bank President Mario Draghi said officials will look again at their policy stance in December to assess whether enough support is being provided to the economy.

“The degree of monetary policy accommodation will need to be re-examined at the Governing Council’s December meeting,” Draghi said at a cultural event in Frankfurt on Tuesday, reinforcing a signal first given on Oct. 22. “The Governing Council is willing and able to act by using all the instruments available within its mandate if warranted in order to maintain an appropriate degree of monetary accommodation.”

Renewed declines in energy prices and slowing global trade are making it harder for the Frankfurt-based ECB to meet its inflation target of just under 2 percent, with price gains slipping into negative territory in September. The ECB has yet to detail how it could adjust its existing 1.1 trillion-euro ($1.2 trillion) quantitative-easing program or add other stimulus.

Draghi said that while euro-area governments need to make reforms to boost growth potential, the ECB can’t force them to do so, and must meet its own mandate.

“The point here is that one cannot expect the ECB to deliver the objectives that rightfully belong to other policymakers,” he said. “We will meet our price-stability mandate, as we are obliged to do in the treaty. But it is up to individual countries to build on that foundation and make their economies work better; and it is up to the euro area as a whole to strengthen the institutional architecture of our union.”

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