LJUBLJANA (Reuters) - The European Central Bank is ready to step up its use of monetary policy tools and introduce new ones if necessary, governing council member Bostjan Vasle told Slovenian national news agency STA as published on Friday.
ECB chief Mario Draghi pledged indefinite stimulus on Thursday to revive an ailing euro zone economy. The bank cut rates deeper into negative territory and promised bond purchases with no end-date to push borrowing costs even lower.
Vasle told STA the ECB could increase volumes and change the conditions for bond purchases.
Risks include U.S. policy, China's economic slowdown and Britain's departure from the European Union and could lead to a further slowing in the eurozone and lower inflation, he said.
"Because of the changed economic conditions, a reaction of other economic policies is needed, particularly fiscal policy and not just monetary policy," said Vasle, who is also governor of the Bank of Slovenia.
"Actions of just one policy cannot change the flow of economic developments when considering the state we are in and the challenges ahead of us," he added.
He said current concerns are focused on an economic slowdown in the eurozone, rather than a recession. The trade dispute between the United States and China had hit manufacturing and industrial sectors the hardest but the services sector was still yielding good results, he said.
Vasle said the ECB's action on Thursday aims to influence not just the short-term interest rates but also interest rates in the longer term.