Meanwhile over in Greec, Mario Draghi’s statements today are not going down well. Helena Smith reports from Athens:

The ECB president’s assertion this afternoon that it is premature to contemplate Greece being included in the bank’s quantitative easing program before its debt is made sustainable has landed with the force of a lead balloon in Athens. “It effectively kills any prospect of debt forgiveness any time soon,” said one well-placed source in the governing Syriza party. “How, in God’s name, is the economy ever to recover after seven years of recession and internal deflation?”

Both investors and government officials say inclusion in the program would be a mood changer for a country enduring its worst slump in modern times.

Prime minister Alexis Tsipras, who has spent the day pushing for debt relief in meetings with top EU officials in Brussels, says inclusion in the program is essential if the debt-stricken nation is to return to capital markets and finally get some form of primary debt relief. Greece has been excluded from QE because of its low credit rating.

Tsipras has called for a debt deal to be concluded by December when Athens hopes to have completed its second review of the economy with international inspectors representing the EU and IMF. The audit begins in earnest tomorrow when Tsipras will also be pressing the point in talks with German chancellor Angela Merkel.

The euro is still at four month lows against the dollar, but the pound is not looking too rosy either.

Sterling is suffering as EU leaders arrive for their latest summit in Brussels, with EC president Donald Tusk saying there would be no pre-Article 50 negotiations about the UK leaving Europe. Meanwhile French president Francois Hollande said if Britain wanted a hard Brexit, negotiations would be hard.

So the pound is down 0.36% at $1.2237 and virtually unchanged against the euro at €1.1201.

Most analysts seem agreed that Mario Draghi’s comments suggest the ECB will unveil plans to extend its quantitative easing measures at its December meeting.

Marco Valli, chief eurozone economist at UniCredit Research, said:

Draghi’s remarks do support our view that in December QE will be extended beyond March 2017 at the current pace...

So any policy decision will be announced on 8 December, when the new macroeconomic projections will be published (they will include for the first time numbers for 2019). What will the ECB do at that meeting? We remain convinced that the general council will opt for an extension of QE by six to nine months at the current pace. This would require €480-720bn of additional purchasable assets. We estimate that, under current market conditions, raising the ISIN limit from 33% to 50% and applying the deposit-rate restriction to a portfolio of bonds rather than to individual bonds would free a sufficient amount of German paper to make this extension possible. Bank bond purchases do not seem to be on the agenda, while a deposit rate cut remains highly unlikely as its side effects would outweigh the benefits.

ING Bank economist Carsten Brzeski said:

It would go too far to call this the Americanisation of the Eurozone. But the outcome of today’s ECB meeting showed some imitations of last night’s presidential debate in the US; at least in terms of memorable statements. Whether it is on tapering, the extension of QE or solutions to the scarcity problem, the ECB is keeping everyone in suspense. At least until the December meeting.

[So] what are the take-aways from today’s meeting? In our view, the ECB is not yet ready to extend QE. The recovery of the Eurozone economy is not weak enough to justify more stimulus but also not strong enough to light-heartedly talk about tapering. This is why the ECB is simply buying time. Mario Draghi’s elegant balancing between tapering and an extension of QE keeps all expectations alive and could have one welcome fall-out: slightly higher long-term rates which will bring some relief to the scarcity problem without panic. At the December meeting, our view is that the ECB will announce an extension of QE until the end of 2017, possibly at a slower pace than the current €80bn.

Ian Kernohan, economist at Royal London Asset Management, said:

There was only a small chance that Mr Draghi would discuss an extension of QE today, following the recent reports that ECB had begun to consider a taper of the programme.

In the event, he chose not to. A more appropriate time to do this will be at the next ECB meeting in December, when bank staff have had a chance to revise their economic forecasts.

Growth in the Eurozone remains sluggish but steady, with no sign of any major impact from the Brexit vote. Very low core inflation and wage growth should most concern policy makers, and are the main reasons we expect a QE extension in March.

But Kathleen Brooks at City Index said although an extension was likely in December, it was not entirely guaranteed:

Although we believe that deflation risks in the Eurozone are receding, we still don’t think that the Eurozone economy is out of the deflationary woods yet, so QE is unlikely to end anytime soon. We do expect the ECB to announce that it will lengthen its asset purchase programme when it ends in March 2017, market expectations are for an announcement at its next policy meeting in December. However, we think that there is a small but significant chance that the ECB may hold off from expanding its QE programme, or it may only extend it in the short-term, as the ECB’s whopping €3.5 trillion balance sheet creates a liquid monetary environment even if QE stops.

Here’s a word cloud of Mario Draghi’s opening statement, showing how it was packed with references to growth, inflation, and the “continued moderate but steady recovery” in the euro area.

You can see the full statement here:

Clearly the press pack have got bored of Mario Draghi not giving more details about its QE plans. We’ve run out of questions, so the press conference has ended early.

Q: Since June the ECB has bought 660 corporate bonds, including from companies such as Nestle and Glencore who have nothing to do with the eurozone. And by driving down the cost of borrowing for large companies, you help them take over smaller ones. How can you justify it?

I don’t have to justify it. It’s not true, Draghi insists.

He argues that smaller companies also benefit from the ECB’s bond-buying, as it encourages banks to lend more to SMEs. That pushes down their borrowing costs.

However, he doesn’t say why the ECB has bought bonds issued by nine Swiss companies.

Q: Would you stop buying Portuguese bonds if Portugal is downgraded by the DBRS credit rating agency tomorrow?

Draghi confirms that a downgrade would mean that Portugal wouldn’t be automatically eligible for QE.

But he also praises Portugal’s progress, hinting that the country wouldn’t be hoofed out into the cold.

Q: Is the ECB worried about running out of bonds to purchase under QE?

Draghi says that bond scarcity was discussed during today’s meeting. But it’s not a problem now; the ECB’s asset purchase scheme is running well.

[this is because current rules restrict how many bonds the ECB can buy from each country, and at what yield levels]

And down goes the euro again....

A question about the eurozone’s new bail-in rules. Is the ECB ready to handle a problem with a large financial institution?

Draghi says the bail-in rules have enough flexibility to cope with different scenarios.

However, he doesn’t see any possibility of this having to be tested at present.

Draghi is giving the German bond market some terrible palpitations!

Q: Was there any discussion of negative interest rates?

We discussed low interest rates, during our assessment of the economic situation, Draghi replies.

And our conclusion was that they don’t hinder the transmission of monetary policy. Low interest rates work, he insists.

It is clear that in December we will tell you what we will do in the coming months, says Draghi.

We didn’t discuss tapering our asset purchase programme, or the possible horizon at which QE might end, Draghi insists.

The euro has jumped half a cent, to $1.1033, after Draghi says the ECB didn’t discuss boosting its QE programme today.

Draghi ends his statement with his traditional call for Eurozone politicians to pull their socks up.

The pace of structural reforms need to be stepped up, he insists, to create new jobs - and fully reap the benefits of loose monetary policy.

All eurozone countries would benefit from structural reforms, he insists (he means you, Germany).

And he cites the need for governments to invest in new infrastructure projects.

That would help growth, and protect the eurozone economy from global shocks.

Draghi predicts that inflation (currently 0.4%) will continue to rise in the next couple of months.

But that’s mainly due to ‘base effects’ (because oil was even cheaper a year ago), rather than a general rise in inflationary pressures.

Mario Draghi has marched forcefully into the press conference, chatting with ECB vice-president Vítor Constâncio.

After a quick smile for the photographers, Draghi starts to read his statement....

Economists are predicting a dovish performance from Mario Draghi at his press conference, and hints of new stimulus measures at the next meeting in December.

This is from Nick Kounis at ABN Amro:

Michala Marcussen, global head of economics at Societe Generale, told Bloomberg TV that:

“What we are expecting today is Draghi to sound quite dovish in his overall tone...come December, we do expect them to tweak the parameters around the QE program.”

And this is from Reuters:

“I will not be surprised to see some bounce [in the euro] later on,” said Niels Christensen, a currency strategist at Nordea.

He expects Draghi to reiterate his commitment to looser monetary policy and quash talk of any tapering of the asset purchase programme.

No significant reaction in the financial markets - the euro is still trading around $1.0975.

European stock markets are still pretty dull too, with the French CAC and German DAX both up around 0.15%.

Mario Draghi may shake things up soon, though....

Today’s ECB statement is identical to last month’s!

Well, there is one slight difference...

FXTM Research Analyst Lukman Otunuga predicts we could see wild volatility in the markets if Mario Draghi suggests that the ECB could slow, or taper, its bond-buying programme.

He writes:

A growing sense of anticipation firmly gripped the financial markets on Thursday as investors prepared for the European Central Bank meeting which most hope could provide clues about a possible extension to the QE program. While it is widely expected that interest rates and the current €80 billion bond buying remains unchanged in October, the press conference where Draghi may be bombarded by taper questions could spark explosive levels of volatility.

With European inflation still well below the golden 2% target and unemployment hovering around 10%, the taper scenario looks quite premature. It seems likely that the ECB adopts an inactive stance this month before potentially taking action in December when the new inflation estimates will be released

The euro hit a three-month low of $1.095 against the US dollar this morning, ahead of the ECB decision, and Mario Draghi’s press conference.

Chris Beauchamp, chief market analyst at IG, says investors are looking for Draghi to hint at fresh stimulus moves:

ECB day has arrived, and as a result markets are becalmed, waiting to see what the oracle of Frankfurt will pronounce.

Having firmly shot down reports of tapering, the ECB meeting will be closely-watched for any sign that the bank is looking to broaden its options with respect to more QE in coming months.

Clearly the euro thinks looser policy is coming, as the currency slumps to its lowest level since July. The Germans might not be keen on further stimulus, but they’ll be even less keen on a stronger euro that hits exports, having already suffered this to some extent due to the fall in sterling, which will boost the price of German imports into the key UK market.

Just one hour to go until the European Central Bank announces the results of today’s governing council meeting.

Most economists expect the ECB will not take any significant decisions, but could prepare the markets for an expanded stimulus push in December:

Here’s our news story about today’s retail sales figures:

Jon Copestake, retail analyst at the Economist Intelligence Unit, is also struck by the jump in online shopping in September:

The most significant take out from these results seems to be the 22% year on year rise in Internet sales. Although this comes from a relatively low base it means that online sales accounted for some 15% of total retail sales in September.

The introduction of grocery lines to Amazon’s offering and expansion of online sales and delivery platforms from the “big four” retailers hints that buying groceries online may be becoming more prevalent, Food retailers have seen online sales doubling in the last five year

Economist Marcus Wright also predicts that higher inflation (driven up by the weak pound) will send a shiver through the high street:

Britain’s shops have probably enjoyed one ‘last hurrah’, before rising inflation hits the high street.

So warns Martin Beck, senior economic advisor to the EY ITEM Club:

“Inflation is now likely to pick up sharply, as the impact of the depreciation in the value of sterling steadily passes through to consumer prices.

The degree to which retailers pass on rising import costs remains to be seen, but there is certainly a sense that the strong Q3 figures for retail sales volumes are likely to represent a last hurrah for the high street, with a more challenging period to come for retailers and consumers alike.”

Fran Marwood, Retail and Consumer Partner at PwC, points out that the weak pound has helped retailers, by encouraging more foreign tourists to visit the UK.

But she also flags up that shops have some tough decisions to make, as the cost of imported goods rise.

She says:

“Despite softening performance in the sector, consumer confidence appears to be holding up well against the backdrop of the Brexit vote earlier in the Summer.”

“Retailers, as we saw in the press with the recent Marmite row, will be seeking to handle the effects of costlier imports as currency hedges expire.

An added dimension this year will be the split of Christmas spending between the high street and online as traditional businesses seek to remain competitive on price and manage an increasing cost base.”

Reminder: Nestle told investors this morning it is considering efficiency savings, and price rises, to counter the slump in sterling.

Online shopping helped to drive UK retail sales up since the Brexit vote, points out economist Rupert Seggins:

The UK economy appears to have held up well since the Brexit vote, says Howard Archer of IHS Global Insight.

Here’s his take on the strong retail sales spending over the last three months:

While flat retail sales in September could be a sign that consumers are starting to rein in their spending as inflation rises, it should be borne in mind that sales were held back in September by warm weather markedly hitting demand for autumn clothing. Higher clothing prices were also seemingly a factor. Furthermore, retail sales were still very strong over the third quarter as a whole, and there could have been an element of some consumers taking a breather after splashing out over the summer.

Indeed, retail sales volumes still grew 1.8% quarter-on-quarter in the third quarter, which was the best performance since the fourth quarter of 2014. This fuels belief that the consumer played a leading role in the apparent resilience of the economy following June’s Brexit vote.

French bank BNP Paribas predict that the European Central Bank will resist launching new stimulus moves today:

We expect the ECB to buy time at its meeting today and postpone any decision on tweaking its quantitative easing programme until December, when the ECB publishes the next round of its staff projections.

Europe’s financial markets have opened very quietly, as investors await news from the European Central Bank.

The FTSE 100 has dipped by 9 points, or 0.1%, while the French and German markets are a little higher.

The ECB has some good news this week, when eurozone inflation hit a two-year high of 0.4%.

That suggests its massive stimulus plan may be having some effect, although inflation is still shy of its target of just below 2%.

The ECB has already pumped hundreds of billions into the eurozone economy through QE, swelling its balance sheet to around €3.5 trillion (the purple line in the chart below).

There are signs that bank lending is picking up too (green line)

Analysts at RBC Capital Markets reckon that the European Central Bank won’t take any big decisions today.

But Mario Draghi’s press conference will still be interesting, as the press probe him on the ECB’s next move.

RBC say:

In summary the recent bond market sell-off has reduced the immediate pressure on the ECB to act and we do not expect major changes from today’s meeting,

However, we still expect that some action is likely to come before year end. Instead the focus should be trained on Draghi’s words and whether he drops any clues on the findings of the review of QE announced last time out and how he deals with questions on the tapering rumours that have circulated in recent weeks.