Draghi’s speech: APP still has considerable headroom, EUR/USD drops to 1.1200

The European Central Bank (ECB) President Draghi’s speech is on the wires now, via Reuters, delivering a scheduled introductory speech on the second day of the ECB Forum on Central banking in Sintra, Portugal.

Key Headlines:

Monetary policy can always achieve its objective alone, but especially in Europe where public sectors are large, it can do so faster and with fewer side effects if fiscal policies are aligned.

If we are to deliver that value of inflation in the medium term, inflation has to be above that level at some time in the future.

APP still has considerable headroom.

The limits we establish on our tools are specific to the contingencies we face.

We will use all the flexibility within our mandate to fulfil our mandate.  

And we will do so again to answer any challenges to price stability in the future.

Symmetry means not only that we would not accept persistently low inflation, but also that there was no cap on inflation at 2%.

All these options were raised and discussed at our last meeting.