Central banks were in focus on Thursday after European Central Bank President Mario Draghi discussed the Brexit vote and the parlous state of the European banking industry and the governor of the Bank of Japan ruled out using "helicopter money" in a radio interview.
In his regular media conference Thursday, following the bank's decision to keep its main interest rates on hold, Draghi said he did not want to underplay the challenges facing the euro zone, including high levels of bad loans in the banking sector and geopolitical instability relating to the U.K.'s vote to leave the European Union and terrorism.
"I'm pretty confident that the strong supervision and robust regulation and better communication by the supervisory agencies… will still improve the situation … and our perception in the world's eyes," he told reporters in Frankfurt.
Draghi added that a public backstop for banks - whereby countries would have to pay to prop up their faltering lenders - might help manage the problem of high levels of non-performing loans (NPLs) in the Italian banking sector.
Such a measure could prove highly unpopular, with citizens in many countries still angry at having to "bail out" banks following the global financial crisis of 2007-08.
"A high level of NPLs makes banks especially vulnerable to the markets as we have seen recently," Draghi said.
The ECB kept the rate on the main refinancing operations at 0.0 percent on Thursday, the marginal lending facility rate at 0.25 percent and the deposit facility at -0.40 percent. As previously, the bank said it planned to keep rates at present or lower levels for an "extended period of time."