Draghi Is Said to Have Faced Nowotny Plea to Discuss Policy

(Bloomberg) -- Mario Draghi kept the European Central Bank’s discussion away from the future path of monetary policy on Thursday despite a plea to the contrary, according to euro area officials familiar with the matter.

Austrian Governor Ewald Nowotny called for a debate on what the ECB will do after quantitative easing runs out in September, according to the people, who asked not to be identified because Governing Council sessions are confidential. While his position was shared by a few others, most policy makers deferred to the president to determine when to examine the topic, they said.

Officials at the ECB rate-setting meeting left policy unchanged and focused their discussion on assessing the recent slowdown in economic data, Draghi said on Thursday. He acknowledged some moderation in growth momentum but stressed that the region’s expansion remains solid and broad-based.

“The interesting thing is that we didn’t discuss monetary policy per se,” he said. “It’s quite clear that since our last meeting, broadly all countries experienced, in a different extent of course, some moderation in growth or some loss of momentum.”

Spokesmen for the ECB and the Austrian central bank declined to comment on the discussion.

Draghi has shown reluctance to allow too much discussion of potential policy changes at ECB meetings amid concern that any sign of a looming shift in stance could stoke market volatility, people familiar with the matter said in February.

Nowotny has sat on the Governing Council for almost a decade, and his candid public statements are a long-standing feature of ECB debate. His suggestion earlier this month that the institution could first raise its deposit interest rate to minus 0.2 percent, from its current level of minus 0.4 percent, earned a rare riposte from the ECB. A spokeswoman said then that the governor’s views don’t represent those of the Governing Council.

©2018 Bloomberg L.P.

Bloomberg
Follow The Latest On The Global Economy On BloombergQuint