UPDATE Draghi: Trend Toward Open Global Markets Under Threat

--Adds Additional Quotes and Context

By Jack Duffy

     PARIS (MNI) - European Central Bank President Mario Draghi sidestepped

questions on monetary policy on Friday, focusing on threats to global trade in a

key speech to central bankers and academics in Jackson Hole, Wyoming.

     Speaking to the Federal Reserve Bank of Kansas City's annual economic

policy symposium, Draghi called for greater multinational cooperation to defend

a trend toward more open global markets that he said may be "coming to an end."

     "A turn towards protectionism would pose a serious risk for continued

productivity growth and potential growth in the global economy," Draghi said.

     The ECB president did not mention the euro in his remarks, but the single

European currency continued to climb during the speech, reaching $1.1940, the

highest level since January 2015.

     Draghi called for continued vigilance in financial regulation, saying lax

regulation was particularly dangerous during periods of easing monetary policy. 

     "Given the large collective costs that we have observed, there is never a

good time for lax regulation," Draghi said. "But there are times when it is

especially inopportune."

     When monetary policy is accommodative, "lax regulation runs the risk of

stoking financial imbalances," Draghi said. "With monetary policy globally very

expansionary, regulators should be wary of rekindling the incentives that led to

the crisis."

--MNI Paris Bureau; tel: +33 1-42-71-55-41; email: jack.duffy@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$X$$$,MT$$$$,M$$EC$]