Fundamental Comment

ECB Draghi: Risks to the eurozone economy remain to the downside

ECB Draghi sounds cautious

At the European Central Bank’s press conference, President Mario Draghi stressed that the details of the new TLTRO will be given at a forthcoming meeting and that the ECB is looking into whether banks need more help to cope with negative interest rates.

Eurozone growth has slowed, ECB Draghi said, where he blamed external factors while stressed that domestic factors dampening eurozone growth was starting to fade.

He noted that risks to the eurozone economy “remain to the downside” and that wage pressures have strengthened. Yet, he insisted that the risk of falling into recession remains low.

When asked about the upcoming TLTROs, he responded that it was “too early” to decide their terms.

As for inflation expectations, Draghi suggested that headline inflation may fall in the coming months.

The euro erased its earlier gains, falling from a peak of $1.1287 to hover near the session’s open at $1.1262. as of 13:55 GMT.

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