2017.01.1922:57:00UTC+00ECB Strikes Dovish Tone as it Keeps Interest Rate, QE Program on Hold

The European Central Bank maintained its ultra-loose monetary policy and told its German critics to remain patient as the euro zone gradually recovers its economic strength.

The euro area central bank's governing council ruled to leave its interest rate unchanged at zero for another month. It was also decided not to make changes to its 2.3 trillion euro bond-buying stimulus program.

While the ECB's decision to stay on its current path of monetary policy has been expected, new criticism from German economists and politicians have emerged and have called for tightening of policies and to end the bond-buying program They argue that the spike in inflation rates seen in euro zone's biggest economy in December will hurt returns on savings of Germans, while governments which are indebted take advantage of the low rates.

Berlin is concerned that these effects will drive the voting population towards the populist parties during the upcoming election.

Draghi defended ECB's decision, stating that while the bloc's economy is stronger, it remains weaker than what they have envisioned. He said that the surge in prices were temporary as it was fueled by a short-lived increase in oil prices and as inflation continues to be under the 2% target. He reiterated that until the ECB has reached its inflation and growth objectives for the euro zone, they would continue to provide support for the economy.