ECB's Weidmann Do Not See Deflation In Eurozone: Report

(RTTNews) - European Central Bank Governing Council member Jens Weidmann said in an interview to the German business magazine VBW that there was no deflation in the euro area now and it was also not very likely in future, reports said Wednesday.

According to preliminary estimates, inflation in the euro area was the weakest since mid-2009 in January. Data from Eurostat showed on Tuesday that producer prices fell at the fastest pace in five years in December.

The very low inflation in Eurozone at present is mainly due to low oil prices, the policymaker noted. He expects a gradual rebound in consumer prices over the medium term.

He also said that the Governing Council do not see a downward spiral of falling prices, which implies deflation, now and such a scenario was not very likely in future.

Regarding the quantitative easing announced by the ECB last month, Weidmann, who is also the head of Germany's Bundesbank, said the plan carries many risks and side effects that outweigh its benefits.

Further, he said the structure of the QE plan meant that debt mutualisation through the central bank balance sheets was limited.