The European Central Bank today defended its decision to hold interest rates steady this month, saying it had a "clear view" of the situation and would act if necessary.

"We have a clear view of the situation and we will act when necessary," the ECB's chief economist Peter Praet told a conference in Frankfurt, Germany.

The ECB has come under fire for not easing monetary conditions further to avert deflation in the 18 countries that share the euro. 

At its policy meeting last month, the central bank held its key interests rates steady at their current all-time lows amid tentative signs of recovery in the euro zone.

Praet insisted that it was too early to accuse the ECB of being "behind the curve" and under-estimating the dangers of deflation. 

The central bank had been among the first to point to the weakness of demand and its consequences for inflation and it has cautioned months ago that inflation was set to remain weak for some time. 

"It wasn't easy, but we did it," Praet said. 

The executive board member insisted that the ECB's communication policy was "balanced" and that the financial markets should not allow themselves to be fazed by short-term phenomena and expect a reaction from every new development. 

He argued that the future publication of the minutes of the ECB's policy meetings would help reduce "market noise". 

"The minutes will be a way to communicate, to give the pros and cons and demonstrate how we discuss in a coherent way," he said. 

The ECB has not yet said when it will begin publishing the minutes of its meetings.