By Marja Novak
LJUBLJANA (Reuters) - The European Central Bank is always studying a range of potential instruments to use, like buying stocks, but it was too early to conclude whether such purchases would be appropriate, Governing Council member Bostjan Jazbec said on Thursday.
The ECB earlier this month tasked its internal committees to explore "options" to keep its 1.74 trillion euro asset buying program running smoothly and said the groups would have full scope to look at everything within the bank's mandate.
When asked about the purchase of stocks, Jazbec said: "We are constantly talking about those things because we are looking at all possibilities that could help make the ECB's monetary policy even more effective."
But he added that the Governing Council will examine data and the committees' recommendations before making a decision so it was too early to say whether stocks would be an appropriate tool.
The ECB has eased monetary policy aggressive in recent years to revive growth and inflation but the stimulus has worked slower than expected and data indicate that price growth will miss its target even in 2018, putting pressure on the bank to unveil even more stimulus.
Markets expect the bank to extend its asset buying program, now due to end in March, by at least six months but few expect new types of assets to be included in the scheme.
Jazbec, who spoke on the sidelines of a banking conference, added that lending growth, a key objective of the ECB, has been insufficient, a complication for the euro zone's bloated bank sector.
"The banking system is prepared to extend loans but there is insufficient demand and that raises questions about the business models of banks in Slovenia and the euro area," said Jazbec, Slovenia's central bank chief.
(Reporting by Marja Novak; Writing by Balazs Koranyi; Editing by Toby Chopra)