Merkel says latest ECB action shows crisis not yet over

(BERLIN) - German Chancellor Angela Merkel said Wednesday that the unprecedented anti-deflation measures announced last week by the European Central Bank (ECB) show that Europe's financial difficulties are not yet over.

Merkel told reporters after a regular meeting with ECB chief Mario Draghi earlier in Berlin that it was the custom not to comment on the Frankfurt-based central bank's decisions, which, she said, were independent.

"However we're seeing currently through the last measures that the euro crisis is not yet completely conquered," she told a joint press conference with visiting Serbian Prime Minister Aleksandar Vucic.

Talks also covered the need to press on "resolutely" with reforms, she said, stressing the importance of EU discussions now on its tasks for the next five years to improve competitiveness and create new jobs.

The ECB lowered all three of its key interest rates last Thursday.

Draghi said immediately after the rates decisions were announced that although the 18 countries sharing the euro were not on the brink of deflation, action to kick-start weak lending to businesses was needed.

The ECB decisions have been criticised in Germany for hitting savers.