ECB policymakers weighed pre-emptive stimulus at January meeting

European Central Bank policymakers weighed pre-emptive monetary stimulus to address prolonged low inflation and weak global economic growth, an account of the 21 January policy meeting revealed on Thursday.

ECB President Mario Draghi said at a press conference after the meeting that the central bank agreed to “review and reconsider” its policy at its next meeting on 10 March.

The account of the policy meeting showed that council members also expressed concern about the impact of falling oil prices on inflation which has remained below the ECB’s target of just under 2% for almost three years.

“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 accounts, rather than wait until after risks had fully materialised,” the account showed.

“However, a remark was made cautioning against adopting an explicit risk-based approach to monetary policy, driven largely by ‘insurance’.”

Weak wage growth in the Eurozone was also discussed during the meeting. "Weaker than anticipated growth in wages, in conjunction with declining inflation expectations, could also signal increased risks of second-round effect," the account added.