Sky News: The European Central Bank says there is economic resilience in the eurozone despite “subdued foreign demand” since the UK’s vote to leave the EU.
The Bank’s president, Mario Draghi, made the comment at a news conference which followed the governing council’s decision to maintain core interest rates at current levels.
He raised the threat of “uncertainties” on trade, arising from the Brexit issue, hitting economic growth – and as a result trimmed the euro area’s growth outlook for 2017 and 2018.
But he also confirmed there was no discussion on whether the ECB would extend the current deadline for the conclusion of its €80bn (£68bn) monthly bond-buying programme beyond March next year, despite some pressure to bolster confidence.
Mr Draghi maintained the ECB had the option of extending it, if needed, but current policy measures were already proving “effective” and there was no need for extra stimulus at the moment.
He did, however, hint there could be more in future by confirming the Bank was studying how it might potentially change its asset-buying programme, which is also known as quantitative easing.
The ECB has pumped €1tn in newly printed money into the eurozone’s banking system through bond purchases since March 2015.
The aim, alongside its interest rate policies, is to bolster lending in the economy and therefore boost activity and output.
Mr Draghi said that while inflation remained low at an annual rate of 0.2%, the ECB was forecasting it to rise in the coming months.
Major stock markets in the euro area sank in the wake of the bank’s announcements – evidence of hope for more stimulus being dashed.
The DAX in Germany and French CAC were both down more than 1% in afternoon trade.
In London, the FTSE 100 also erased all its gains during the session to turn flat.
