ECB's Visco says new stimulus was necessary to counter deflation risk

MILAN (Reuters) – European Central Bank policymaker Ignazio Visco said on Saturday recent expansionary measures agreed by the bank were necessary to counter the risk of a return to deflation in the euro area.

“We must counter the significant risk that the economic slowdown and the low level of inflation translate into a permanent reduction in inflation expectations or a re-emergence of the threat of deflation,” Visco said during a conference.

At its Sept. 12 monetary policy meeting, the ECB decided to resume asset purchases designed to loosen monetary policy, a decision opposed by a third of the policymakers.

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