ECB feared stimulus wasn't working _ so it added a trillion

Staff Writer
Columbus CEO

FRANKFURT, Germany (AP) — The European Central Bank's governing council members wrestled with fears that falling prices could become ingrained in the eurozone economy before a "large majority" decided last month to launch a 1 trillion euro monetary boost.

That's according to an account of the ECB's historic closed-door deliberations on Jan. 22, when it acted to revive the economy of the 19-country eurozone.

With Thursday's publication of the account, the ECB joins the U.S. Federal Reserve and the Bank of England, which both reveal minutes of their meetings weeks afterward.

The ECB launched its latest stimulus plan after finding that the effect of earlier stimulus efforts such as cheap loans to banks "was more limited" than expected.

Some members argued the risk of outright deflation was "relatively small." That view ran into "broad agreement" that the risk "even if uncertain" was too great to hold off on taking action.

The ECB avoided calling the 18-page documents "minutes," referring to it as an "account" as it contained no names to any of the arguments contained in it. The ECB is juggling the desire to be more transparent with concern that the national central bank heads who sit on the board could face political pressure at home for not acting in perceived national interest. They are supposed to choose one monetary policy that's good for the whole 19-country currency union.

The original proposal was for 50 billion euros in monthly bond purchases to end at the end of 2016. But the board decided to front-load the purchases by raising the amount to 60 billion per month through September 2016, keeping the amount the same.

The bank says the purchases could continue if needed to boost inflation. The eurozone economy saw prices fall by 0.6 percent annually in January.