- Doesn’t see deflation in Europe
- Situation different from Japan
- Well aware of downside risks low inflation poses
- Ready to act, have plenty of instruments
- Inflation well anchored, will stay low for protracted period
- ECB cannot supplement banks if they lack capital
- We are in middle of modest gradual recovery
- ECB should speak up against threat to independence
- If and when we do another LTRO would have to be geared to increasing probablility that funding goes to real economy
- Will have to think deeply to find right instrument
- Fully aware that SME’s are struggling
- Risk weights for sovereign debt not a task for now, should be agreed globally
- In stress tests sovereign debt will be assessed like any other item on balance sheet
- Must make sure resolution mechanism actually works
Mario speaking in Strasbourg
No real difference from the ECB presser last week but the euro is taking a dip to 1.3764
