The European Central Bank left interest rates and asset purchases unchanged on Thursday.
The ECB left its main refinancing rate at 0% and monthly asset purchases at €60bn.
Mario Draghi, president of the ECB said that he expected to see interest rates at present levels well past the end of its quantitative easing (QE) programme.
Inflation pick up
Speaking after the ECB's monthly meeting in Frankfurt, Draghi confirmed that QE would run until the central bank saw sustained inflation pick up.
"While the ongoing economic expansion provides confidence that inflation will gradually head to levels in line with our inflation aim, it has yet to translate into stronger inflation dynamics.
"Headline inflation is dampened by the weakness in energy prices. Moreover, measures of underlying inflation remain overall at subdued levels. Therefore, a very substantial degree of monetary accommodation is still needed for underlying inflation pressures to gradually build up and support headline inflation developments in the medium term."
He added: "If the outlook becomes less favourable, or if financial conditions become inconsistent with further progress towards a sustained adjustment in the path of inflation, we stand ready to increase our asset purchase programme in terms of size and/or duration."
Inflation eased to 1.3% in June, down from 1.4% in the previous month, remaining well below the ECB's target rate of 2%.
September taper announcement unlikely
Kathleen Brookes at City Index said: "The key takeaway from today’s meeting is that a September taper announcement looks increasingly unlikely as the ECB said that a 'very substantial degree of accommodation is needed' to boost inflation."
There was busy buying in the German bond market following the ECB's decision to keep rates unchanged.
The Euro was also higher following Draghi's speech. Jordan Rochester at analyst Nomura said this was a positive response to the ECB's commitment to a flexiblie monetary policy and that it is prepared to act if necessary.