Draghi’s Full Press Comments After ECB’s No Rate Cut Decision

Draghi’s first real comment is that the euro is “irreversible.” He also maintains that the monetary expansion remains subdued but noted that inflation should continue to decline throughout 2012 and that the inflation expectations remain anchored. He also maintained that further intensification of market tension poses downside risks.

Draghi also pointed out that there are exceptionally high risk premiums in several government bond prices. What is helping is that Draghi said that governments must stand ready to activate EFSF/ESM in the bond market (bond buying) and that the ECB may undertake outright open market operations within its mandate. The government council also should consider taking other nonstandard measures.

Here is the full statement issued by the ECB.

JON C. OGG