The European Central Bank (ECB) Governing Council member Jens Weidmann said in a speech in Frankfurt on Friday that the low inflation in the Eurozone was driven by lower energy prices.

"At the moment, the sharp fall in energy prices is what is mainly driving the low rates. This drop has pushed down headline inflation by about one percentage point. Correspondingly, the core inflation rate stands at 1% and should gradually increase towards our definition of price stability, which is - let me remind you - a medium-term concept," he said.

"Crucially, the decline in oil prices is more of an economic stimulus for the euro area than a harbinger of deflation. Lower oil prices reduce energy bills for both households and firms," Weidmann added.

He pointed out that the ultra-loose monetary policy could lead to risks.

"We need to be aware that the longer we stay in ultra-loose monetary policy mode, the less effective this policy will become and the more the attendant risks and side-effects will come into play," Weidmann said.