Coeure: ECB Ready To Cut Rates Further If EMU Economy Weakens

thenews 2013.05.05 21:21

The ECB is ready to lower its interest rates further if the Eurozone economy continues to weaken, Executive Board member Benoit Coeure said Saturday.

"We can always cut more; we were clear on this matter," Coeure said in a radio interview, offering the most explicit confirmation of the central bank's easing bias since ECB President Mario Draghi explained Thursday its decision to lower the key refinancing rate by 25 basis points to a record low of 0.50%.

While "indispensable" given economic situation, Thursday's rate cut was "not enough," Coeure said, citing the need for structural reforms "so that the reduction in rates benefits companies, employees and jobseekers."

Yet the central bank itself can provide further support to the economy, Coeure said: "We will cut if new indicators confirm the deterioration of the situation."

France's representative on the Executive Board urged the French government to make good use of the two-year delay accorded Friday by EU fiscal authorities to respect the Maastricht public deficit ceiling of 3% of GDP.