By DAVID McHUGH
FRANKFURT, Germany (AP) â¿¿ With the economy shrinking and unemployment rising, the head of the European Central Bank said it was looking at new measures to stimulate growth if the hoped-for recovery doesn't start soon.
Mario Draghi said Thursday the bank was considering a range of actions to boost lending to companies and reinvigorate the ailing euro region's economy, which has been in recession for a little over a year.
Draghi said the ECB had an "extensive" conversation at its monthly policy meeting about lowering its benchmark interest rate and other ways of jump-starting the region's economy. The eurozone has been weighed down by towering government debt and austerity measures aimed at fixing the problem.The ECB decided to leave its benchmark interest rate unchanged at 0.75 percent, where it has stood since July 2012. Analysts took Draghi's remarks, made at the ECB's monthly news conference in Frankfurt, Germany, as sign that the bank had moved closer to another rate cut or other stimulus measures if there is any sign that the recovery predicted by the bank for the second half of the year is delayed. Draghi's remarks were "a strong hint they could act very soon," said Christian Schulz at Berenberg Bank in London. The ECB head was expanding on comments made last month, when he said the bank was "actively reflecting" on new nonstandard measures. This time he said the bank was now "looking at various instruments, various tools." Draghi didn't say what the ECB is considering to kick-start the economy of the 17 European Union countries that use the euro. Analysts say, however, the bank is mostly likely looking at ways to encourage lending to midsize companies so they can expand and hire. One way to encourage such lending would be to allow banks to bundle the small business loans they make into securities, which they could use as collateral to get cash loans from the ECB â¿¿ money they could then lend again.