Draghi gets backing for eurozone QE extension

EU-Europe-Flags-Euro-700x450.jpgThe European Central Bank’s governing council has given its support to extending quantitative easing next month.

A statement on the minutes of the monetary policy meeting of the 20 and 21 January, published today, show the ECB’s governing council unanimously said the aggressive policy stance “needed to be reviewed and possibly reconsidered” at the council’s next meeting in March.

The statement said: “The point was made that, in a situation in which risks were predominantly on the downside and new downside risks were emerging, it would be preferable to act pre-emptively, taking emerging risks into account, rather than to wait until after risks had fully materialised.”

However, the council said policy rates would remain at current or lower levels for “an extended period of time”, as previously announced by ECB president Mario Draghi.

The council said: “In the light of prevailing uncertainties and volatility, members considered it premature to conclude on policy action at the current meeting and to discuss precise policy options that could be taken, if needed.”

In December, the overnight deposit rate was cut to -0.2 per cent in an attempt to push banks to lend.

That same month the ECB extended its monthly €60bn stimulus programme by six months to March 2017.