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Draghi Sees Risks on Downside as ECB Analyzes Negative Rates

Pickup in inflation is delayed, warranting continued accommodative monetary policy that includes negative interest rates: Draghi.

Draghi Sees Risks on Downside as ECB Analyzes Negative Rates
Mario Draghi, president of the European Central Bank (ECB). (Photographer: Alex Kraus/Bloomberg)

(Bloomberg) -- European Central Bank President Mario Draghi said risks to the euro area’s economic outlook remain tilted to the downside and a pickup in inflation is delayed, warranting a continued accommodative monetary policy that includes negative interest rates.

“If necessary, we need to reflect on possible measures that can preserve the favorable implications of negative rates for the economy, while mitigating the side effects, if any,’ Draghi said. “That said, low bank profitability is not an inevitable consequence of negative rates.”

To contact the reporter on this story: Piotr Skolimowski in Frankfurt at pskolimowski@bloomberg.net

To contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Jana Randow, Carolynn Look

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