FRANKFURT (16 December 2016) – While the European Central Bank reduced support for eurozone economy by one more notch on Thursday, it promised to provide ample support through 2022. This confirms its relaxed approach on inflation, and indicates that an exit from decades of extremely-easy policies will take place slowly.

Below are some highlights from Christine Lagarde, President of the ECB after her policy meeting’s news conference.

EASING INFLUENCE

“Inflation will likely remain high in the short term, but it should fall in the next year,”

CONTACT US ABOVE TARGET

Although the inflation outlook was revised upward, inflation projections still project that inflation will remain below the 2% target for the projected horizon.

HEADWINDS

Energy prices are on the rise and some sectors have shortages in labour, materials and equipment. These are factors that are restricting economic activity, and they are an obstacle to the long-term outlook.

LABOUR MARKET IMPROVING

The euro area’s economy is recovering and the labor market continues to improve, thanks in large part to policy support.

PICK-UP

We expect that activity will pick up strongly next year, despite the fact that growth is slowing.

(Reuters Global News Desk).