Bundesbank’s support for stimulus ‘won’t be automatic’

The Bundesbank’s support for any more stimulus for the eurozone will not be automatic even if the ECB cuts its inflation forecast for 2016, according to sources.

While the German central bank will focus on the outlook for price stability at the end of the ECB’s forecast horizon and is open to measures from a negative deposit rate to halting the sterilisation of crisis-era bond purchases, nothing is decided yet, said the people.

ECB president Mario Draghi said last week that the governing council is “comfortable” about taking action at the June 5 monetary policy meeting, when it will publish revised macroeconomic projections. The Wall Street Journal reported earlier that the Bundesbank is open to significant stimulus if officials lower their inflation outlook for 2016.