Les fonctions vitales de l’économie sous assistance de la BCE[en] 

The ECB said the central bank's massive supply of liquidity would be phased out over time but it would be premature to start this year. 

"Given the state of the economy, we do not see a need to start executing an exit strategy," ECB Governing Council member Ewald Nowotny said at the Reuters Central European Investment Summit in Vienna. 

The ECB has pumped billions of euros into money markets in an attempt to restore order and to reduce the cost of borrowing for banks, firms and consumers. 

ECB President Jean-Claude Trichet said for many commercial banks the cash had become the dominant source of funding, but stressed it would not last indefinitely. 

"The strong intervention of the Eurosystem [liquidity programme] in the euro area money market cannot be maintained forever," he told a hearing of a European Parliament committee in Brussels. 

"The ECB has an exit strategy and stands ready to put it into action when the appropriate time comes." 

Trichet brushed off concerns that the ECB's liquidity injections, which will begin again on Wednesday (30 September) with its second loan of 12-month funds, would fuel inflation in the 16-nation region. 

Economists do not expect interest rates in the euro zone to rise before the third quarter of next year, but the ECB has given no clear sign on whether it will mop up liquidity before hiking rates, or the vice-versa. 

(EurActiv with Reuters.)