southcoasttoday.com
 

Aug 17, 8:28 AM EDT

An account of the European Central Bank's last meeting shows its policymakers were still concerned that inflation was too low

AP Photo
AP Photo/Michael Probst

Multimedia
A district summary of the Beige Book
Measuring economic stress by county nationwide
Mall malaise: shoppers browse, but don't buy
Unemployment by the numbers
Family struggles with father's unemployment
Saying an affordable goodbye
Hard times hit small car dealer
Latest Economic News
An account of the European Central Bank's last meeting shows its policymakers were still concerned that inflation was too low

Official figures are showing that retail sales in Britain rose by a solid if unspectacular 0.3 percent in July from the month before

Official figures are showing that retail sales in Britain rose by a solid if unspectacular 0.3 percent in July from the month before

The Philippine economy grew 6.5 percent in the second quarter from a year ago

Correction: Economy-Jobs Report story

Game of Thrones: What you don't know can get you killed by dragons or zombies

US retail sales rose 0.6 percent in July amid strong auto demand, best gain in 7 months

The German economy, Europe's largest, continued its strong performance in the second quarter with gross domestic product growing 0.6 percent over the previous quarter

Official figures show that industrial output across the 19 countries that make up the eurozone fell in June, a development that will likely reinforce concerns about the export-sapping impact of the rising euro

Japan economy gains momentum, growing at 4.0 percent annual pace in April-June helped by stronger consumer, corporate demand

Interactives
Greece's Debt Threatens to Spread
State budget
gaps map
Auto industry problems trickle down, punish Tennessee county
Women give old Derby hats a makeover in tough economy
S.C. town deals with highest unemployment in South
How mortgages were bundled and sold as securities
Tracking the $700 billion financial bailout
Tracking the year's job losses
State-by-state foreclosures since 2007
Credit crisis explained
Presidents and their economic legacies
Lexicon of the financial crisis
Americans' addiction to debt

FRANKFURT, Germany (AP) -- The European Central Bank's policymakers are still concerned that inflation in the 19-nation eurozone is too low despite an improving economy and seem worried about the strength of the shared euro currency, their last meeting shows.

The account of the July 20 meeting, published Thursday, shows the rate-setters noted that market investors seemed overly aggressive in thinking the bank would wind down its stimulus program soon. That was reflected in the value of the euro, which has risen in recent weeks on expectations that the ECB would gradually move away from its ultra-low rates monetary policy.

Although the eurozone economy is growing at a strong pace, inflation is only at an annual rate of 1.3 percent, well below the 2 percent target that the ECB considers most suitable for a healthy economy.

The meeting's account says "concerns were expressed about a possible overshooting" in expectations among investors, especially in currency markets, about how soon the ECB would let market interest rates rise.

Overall, the account shows caution by the ECB about how quickly to signal to investors that they would ease off their bond-buying stimulus program. The program seeks to keep market interest rates low - which in turn affect the costs of loans and mortgages - by flooding the financial system with newly created money. The ECB is pumping 60 billion euros ($70 billion) a month into the economy.

"There was broad agreement among members that there was presently a continuing need for steady-handed and persistent monetary policy," the account said.

Many investors think the ECB will signal in the autumn its intention to dial down the bond-buying program, and to actually do so next year.

The euro slumped upon Thursday's report, as some investors found the comments more cautious than expected. The currency fell almost a cent against the dollar, or 0.6 percent, to $1.1695.

© 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Learn more about our Privacy Policy and Terms of Use.