ECB's Coeuré Defends Bank's Policies to German Audience
May 01 2016 - 9:41AM
Dow Jones News
By Todd Buell
FRANKFURT--A top European Central Bank official has defended the
central bank's policies to a German audience, stressing that the
current low interest policy also benefits savers over the longer
term.
He also said in a newspaper column that it would be detrimental
for the central bank to renounce its inflation target in the face
of very low inflation.
"Silently giving up on the commonly agreed inflation objective,
which has served the ECB well for the last 13 years, is not an
option," said Benoît Coeuré on Sunday in a column in Germany's
Frankfurter Allgemeine Sonntagszeitung. "This would make our
monetary policy less credible and would in itself create
instability."
The ECB targets inflation at just below 2% over the medium term,
but it has struggled in recent years to get inflation back to
target. The most recent official estimate, published on Friday,
showed prices in the 19-country currency bloc fell 0.2% in April in
yearly terms.
The ECB has come under fire recently in Germany. Critics accuse
the central bank's low interest rate policy of hurting returns on
savings accounts and pensions. Mr. Coeuré hit back, saying "people
are not just savers--they are also employees, taxpayers and
borrowers, as such benefiting from the low level of interest
rates."
He said in the column that low interest rates are needed now "to
ensure a normalization of economic conditions, including higher
returns on savings in the future."
Write to Todd Buell at todd.buell@wsj.com
(END) Dow Jones Newswires
May 01, 2016 09:26 ET (13:26 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.