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Key quotes from ECB head Draghi’s press briefing

September 5, 2013

FRANKFURT, Germany (AP) — At his monthly news conference following the European Central Bank’s policy-setting meeting, President Mario Draghi on Thursday answered questions from reporters.

Here are some highlights of the things he said:

— INTEREST RATES

The ECB kept its key refinancing rate at the record low of 0.5 percent on Thursday and reiterated its “forward guidance,” an indication on where it expects interest rates to be in coming months.

“The Governing Council confirms that it expects the key ECB interest rates to remain at present or lower levels for an extended period of time.”

— GROWTH

The ECB raised its economic growth forecast for 2013 but trimmed it for 2014. Draghi said that while there was a gradual improvement in domestic demand, it was still fragile.

“I am very, very cautious about the recovery. I can’t share enthusiasm. It’s just the beginning. These shoots are very, very green.”

— POSSIBLE CUT

Draghi said the ECB’s Governing Council had discussed an interest rate cut. He said some members argued a rate cut should not be considered as the economy was improving, while others argued the recovery was still too weak.

“It (the recovery) was too green to exclude this discussion.”

— INFLATION

The ECB is tasked with keeping the consumer price inflation rate at or near 2 percent. It fell to 1.3 percent in August from 1.6 percent in July. Draghi said inflation was likely to remain subdued.

“Underlying price pressures are expected to remain subdued, reflecting the broad-based weakness in aggregate demand and the modest pace of the recover.”

— REFORMS

Governments in the 17-country eurozone have been reforming their economies to reduce debt and improve growth. Draghi said the work was not over.

“Euro area countries need to continue with their reform agenda.”