2012.05.03 15:14:46 UPDATE: Draghi Again Puts Onus On Governments To Act

(Rewrites, adding details.) By Geoffrey T. Smith Of DOW JONES NEWSWIRES LONDON (Dow Jones)--European Central Bank President Mario Draghi Thursday took up the rhetoric of Europe's politicians and turned it back on them, saying that the growth that they are so keen to promote is in their own hands. "I certainly agree that...we have to put growth back at the center of the agenda," Draghi said, but prefaced his remarks with a reminder that his own position--that higher deficits won't bring growth--hadn't changed. "There is absolutely no contradiction between a growth compact and a fiscal compact," Draghi said. Draghi was making his comments at the ECB's regular press conference after its policy-setting council left interest rates unchanged, against a backdrop of increasing political pressure from a resurgent European left wing. That resurgence has been embodied in French Socialist leader Francois Hollande, who is favorite to be elected President of the euro zone's second-largest economy on Sunday. Draghi gave no hint of the ECB either cutting rates or taking any new non-standard measures in the near term, saying that the council hadn't even discussed cutting interest rates. Instead, he put the onus back on governments again. "Several governments need to be more ambitious," Draghi said, repeating the list of measures that the ECB has already taken to support the economy. "They must take determined policy actions to address major imbalances." He acknowledged that some had made substantial progress in reducing their deficits and their economies, but stressed that there was still a long road ahead for them. "I think perseverance is very important to reap, in the end, the gains," Draghi said. In opening remarks at his monthly press conference, Draghi had stuck largely to his previous assessment of the euro-zone economy, saying it would "recover gradually" over the course of the year. At the same time, Draghi said, inflation will stay above the bank's medium-term target of "close to, but below, 2%" for the rest of the year, but will fall below 2% early next year. Inflation fell to 2.6% in March from 2.7% the previous month. He said underlying price pressures were "limited" given the weakness of the economy, and the "prevailing uncertainties" that surround it. "The economic outlook continues to be subject to downside risks," Draghi said. Draghi also said the ECB had noted an increase in deposits at banks in March, but said the ECB's massive injections of liquidity at the turn of the year "will need time" to have their full supportive effect. -By Geoffrey T. Smith, Dow Jones Newswires (+44 207) 842 9941; geoffrey.smith@dowjones.com (END) Dow Jones Newswires May 03, 2012 09:14 ET (13:14 GMT)