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BERLIN (MNI) – European Central Bank President Mario Draghi on
Tuesday defended the ECB’s new bond-buying program, the OMT, arguing
that the greatest risks for the Eurozone would be inaction.

“We cannot always look to the past for answers, we may need to take
new steps to achieve long standing goals,” Draghi stressed in a speech
at an event organized by the German Industry Association here.

“For the ECB new steps have been needed to maintain price stability
in the face of a fragmented financial market,” Draghi explained. “These
new steps are not a departure from our mandate, indeed they are the only
way to ensure that we continue to fulfill our mandate,” he insisted.

“All the measures…are fundamentally about ensuring stability in
the current circumstances,” the ECB president explained. “The greatest
risk to stability is not action, it’s inaction, this is why the ECB has
acted.”

“We have played a role in improving overall confidence by removing
unfounded fears about the euro area that were affecting our ability to
ensure price stability,” Draghi said. He again vowed that “the euro is
irreversible.”

“My firm belief and central message to you today is that –
provided all policymakers persevere with the necessary reforms – we
have a number of reasons to be positive about where the euro area is
heading,” Draghi said.

“We’re seeing signs of improved sentiment in financial markets and
we expect the economy to return to growth next year,” he said. “Clear
progress is being made towards addressing the fundatmental causes of our
current challenges, deficits are being reduced, rebalancing is happening
and governance is being reformed.”

Draghi vowed that the ECB will continue to deliver price stability
in the future. “The credibility of our commitment is clear,” he argued.
“Indicators of inflation expectation show that the citizens and
financial markets expect inflation to remain low in line with our
mandate.”

Draghi stressed, though, that the ECB’s measures “can only build a
bridge towards a more stable future.” He argued that “it must be
complemented with decisive measures by governments to address
fundamental challenges and complete the euro area’s institutional
architecture.”

The ECB president acknowledged that economic growth in the Eurozone
“remains highly uneven with some parts of the euro area economy
expanding still at solid but moderate pace and others are in a phase of
adjustment or pure recession.”

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