Euro zone economy to improve, but there are risks: ECB's Draghi

FRANKFURT (Reuters) - The euro zone economy should continue to improve slowly, European Central Bank President Mario Draghi said on Thursday, with inflation creeping up in the coming months.

But the risks are to the downside, he said, meaning performance is more likely to be worse than better.

Draghi said it was mainly economic events outside the euro zone that would affect the economy.

"The economic recovery in the euro area is expected to be dampened by subdued foreign demand," he told a news conference following the ECB's decision to leave monetary policy unchanged.

"We will continue to act, if warranted by using all the instruments available in our mandate," he said.

(Written by Jeremy Gaunt; Editing by Kevin Liffey)

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