ECB will do whatever it takes to meet inflation target, Constancio says

Rate-setters in Frankfurt flagged to markets their willingness to keep adding to stimulus if that was necessary to meets its target for price stability.

Speaking at the presentation of the European Central Bank’s annual report, on Thursday, vice-president Vitor Constancio said that: “the ECB has done and, within its mandate, will continue to do whatever is needed to pursue its price stability objective which now implies also trying to foster growth," according to the text of his speech posted to the monetary authority’s website.

In parallel, ECB chief economist Peter Praet presented the ECB's estimates of the effectiveness of its policies.

They would add over 0.50 percentage points to Eurozone inflation in 2016, without taking into account the policy-easing measures unveiled in March, he said.

"Without these measures, the euro area would have been in outright deflation last year and prices would have fallen at an even faster rate this year. Growth would have been significantly lower,” Constancio added.

Constancio called on governments to do their part to cement the foundations of the European Union and adopt measures to foster innovation and productivity and put the economy back on the path of robust, sustainable growth and job creation.

Later in the day, ECB executive board member Benoit Coeure said he was satisfied with the effectiveness of the package of monetary stimulus measures launched by the governing council at its most recent policy meeting.

Nonetheless, even as he referred to a mildly expansionary fiscal stance as "appropriate", he recommended that euro area governments continue using what available space they had to boost their spending.

Coeure also said the ECB's actions were not conditioned by what authorities do or do not do, in possible reference to the US Federal Reserve, Market News International reported.