Playing down the risk of deflation would be negligent, especially in times of persistently low inflation. Although falling oil prices have recently played a significant role in low inflation, the effect on inflation is not negligible or temporary. For example, falling oil prices quickly affect other sectors, such as transportation. They also foster second-round effects on inflation, e.g. through lower wage settlements.
The ECB’s measures are effective The ECB’s monetary policy measures make a key contribution to ensuring price stability in the euro area. They also support growth and employment. On 3 December 2015 the ECB expanded its asset purchase programme (APP) by extending it until at least March 2017 and reinvesting maturing bonds.