European Central Bank President Mario Draghi said policy makers will be ready to implement further stimulus measures if needed as he signaled officials may cut growth forecasts next month.
The Governing Council has “has tasked relevant euro system committees with the timely preparation of further measures to be implemented if needed,” Draghi said at a press conference in Frankfurt today, after the ECB left interest rates unchanged.
“The Governing Council is unanimous in its commitment to using additional unconventional instruments within its mandate.”
In stressing unanimity of purpose, Draghi is seeking to smooth over divisions in his own ranks about the precise way the ECB can aid the economy more, as pessimism about the outlook builds. While the central bank is already expanding its range of asset purchases, it has yet to commit to broad-based bond buying, or quantitative easing.
Programs already announced this year, such as long-term loan initiative and purchases of covered bonds, will “have a sizable impact on our balance sheet which is expected to more toward the dimensions it had at the beginning of 2012,” Draghi said. “They will thereby futher ease the monpol stance more broadly.”
The euro fell as much as 0.97 percent as Draghi spoke, trading at $1.2425 at 2:42 P.M. in Frankfurt.
Draghi said that there are “indications” that point officials toward requiring “downward revisions to forecasts.”
The ECB will release its new quarterly outlook for the euro region economy at its decision in December.