The European Central Bank (ECB) will "possibly" approve fresh stimulus measures next month, its president Mario Draghi confirmed Monday, commenting on faltering growth and stock market jitters in the eurozone.

Geopolitical tensions in Ukraine and the Middle East, slowing demand from China, internal wrangles on migration, Greece and Britain and concerns over the solidity of banks are weighing down the euro area, and hampering its recovery from recession.

Acknowledging "a general deterioration in market sentiment [that] has taken root and has gathered pace over the last week," Draghi told the European Parliament in Brussels that the eurozone and the European Union "face significant challenges."

"The ECB is ready to do its part ... The governing council will review and possibly reconsider the monetary policy stance in early March," he added, in comments to the parliament's economic affairs committee.

The ECB rate-setting panel is to meet in Frankfurt on March 10.

Draghi also called on governments to stimulate the economy through public investment, notably on infrastructure, as well as tax cuts.

He said the need for such measures was becoming "clearer and clearer," potentially giving fodder to the arguments of anti-austerity politicians like Italy's centre-left Prime Minister Matteo Renzi.

But Draghi said respecting eurozone budget discipline rules "remains essential" - even though he recalled their built-in "flexibility" - and stressed that only countries without debt and deficit problems can afford to be more profligate.

The net effect of fiscal policies followed by the eurozone's 19 governments "should be expansionary while respecting and complying with" budget rules, Draghi said. "It's easy to say for me, it's very difficult to do it politically," he added.

The ECB chief also defended European banks, whose share prices have tumbled in recent weeks, insisting that they were far more solid than a few years ago, as they have "significantly strengthened their capital positions" following ECB stress tests.

European banking share prices have suffered following the January 1 application of bail-in rules, which force the cost of bank rescues on troubled lenders' shareholders and investors, rather than on the public purse.

The regulation was introduced after governments spent billions to rescue the financial sector in the wake of the 2008 crash, but critics say the new regime is counterproductive as it scares investors off banks, fuelling a confidence crisis in the sector.

Bank of Italy Governor Ignazio Visco called last month for the bail-in regime to be phased in more gradually, but Draghi ruled out major changes.

"The rules have just entered into force, I think it is difficult to start thinking already of a revision," he said, calling however for investors to be better informed about them and for banks to act with more transparency.

Latest news

Syrian opposition rules out future role for President al-Assad

The Syrian opposition said Friday it would not accept any role for President Bashar al-Assad in the future of the war-torn country, reacting to a recent US shift saying that removing al-Assad is no longer a priority for Washington.

Russian Army integrates breakaway forces of Georgian province

Parts of the small fighting forces of the Georgian breakaway province of South Ossetia have been placed under Russian military control, Russian Defence Minister Sergei Shoigu said on Friday.

Czech Republic's Pilsner Urquell beer is now Japanese

Japanese brewing company Asahi completed its takeover of the Czech brewery Pilsner Urquell on Friday, Asahi said in a statement.

Judge approves 25-million-dollar settlement of Trump University case

A US district judge on Friday approved a 25-million-dollar settlement of lawsuits and state fraud allegations against Trump University, the US president's now-defunct business venture.

Former Thai premier Thaksin to junta on reconciliation: 'Cut me out'

Former Thai prime minister Thaksin Shinawatra on Friday announced that he is not interested in the junta-led reconciliation process, three days after the junta handed him a half-a-billion-dollar tax bill for his past business deal.

Dalic: We welcome possible deal between Agrokor and banks

The government welcomes the possibility of an agreement being concluded between the Agrokor food company and creditor banks, and the bill on vitally important companies is not a fallback plan but the result of the government's care for the overall economic and financial stability of Croatia, Deputy Prime Minister and Minister of Economy Martina Dalic told a press conference in Zagreb on Friday.

Croatia, China sign action plan for cooperation in agriculture

The Croatian and Chinese ministries of agriculture on Friday signed an action plan for cooperation in the field of agriculture for the period 2017-2018, the Croatian ministry said in a statement.

ZSE indices up, Agrokor shares in focus of investor interest

The Zagreb Stock Exchange (ZSE) indices on Friday rose by more than 1.8%, with stocks of the Agrokor food and retail concern being in the focus of investor interest again.

Berlin police defend handling of Berlin market attacker

Berlin police defended themselves on Friday against accusations that they stopped surveillance on Berlin Christmas market attacker despite knowing in June 2016 he was dangerous.

Croatia, creditors tailor emergency measures to save tottering giant

Croatia's tottering retail and food giant Agrokor reached an agreement with its creditors, putting its debts standby and allowing it to continue working during emergency restructuring, the Croatian branch of Austria's Erste Bank said Friday.

Agrokor's creditors say standstill agreement to go into force today

A standstill agreement regarding the Agrokor concern's existing financial obligations to banks will take effect on Friday, additional capital will be injected into the concern in the coming days and the concern will be actively restructured, which includes a change of its management, it was said on Friday after a meeting between Agrokor's suppliers and creditor banks.

Palestinians, UN slam Israel's new settlement plan

Palestinians, Israeli activists and the UN lambasted the government of Israeli Prime Minister Benjamin Netanyahu on Friday, a day after it gave the go-ahead for the first new West Bank settlement in a quarter of a century.

South Sudan rebels release three abducted foreign oil workers

South Sudanese rebels have released three foreign engineers they abducted in early March in the oil-rich Upper Nile region, Foreign Affairs Ministry official Mawein Makol Arik said on Friday.

Turkish opposition: Imprisoned party chief has gone on hunger strike

The head of Turkey's pro-Kurdish opposition party has launched a hunger strike from prison.

European leagues threaten Champions League schedule clashes

The European Professional Football Leagues (EPFL) on Friday threatened schedule clashes on Champions League matchdays in an ongoing dispute with the governing body UEFA.

Danish court revokes citizenship of IS volunteer

A Danish appellate court on Friday stripped a man of his Danish citizenship for volunteering to fight for the extremist Islamic State in Syria.

Banks and Agrokor agree on key elements of standstill agreement

Member banks of the coordinating committee of financial creditors and representatives of the Agrokor food company have in principle agreed on key elements of a standstill agreement, which is expected to be signed later today, announcing changes in the company's management team, Erste Bank said in a statement on Friday afternoon.

Syrian man on trial in Sweden; mosque attack labelled terrorism

A Syrian man went on trial Friday in the southern Swedish city of Malmo, charged with terrorism and arson after an attack last year on a building used as an assembly hall by Shiite Muslims.