Mario Draghi, head of ECB
Mario Draghi said growth is returning in Europe and called for further euro integration Reuters / Wolfgang Rattay

Growth is returning in Europe, European Central Bank President Mario Draghi said on the evening of 1 October. This is good news for the euro, which has struggled on the world stage for seven long years.

"The progress achieved over the past three years to stabilise and strengthen the euro area is real," Draghi said in remarks prepared for the Global Citizen Award at the Atlantic Council in New York. "Growth is returning."

Europe's economic pick-up comes after the region's failings to make "a major contribution to the global expansion in the past seven or eight years," Draghi said.

"Though the euro area has not made a major contribution to world growth over the past seven or eight years, it nonetheless accounts for 17% of global GDP and 16% of global trade," he said.

Calls for further euro integration

His comments come as the ECB is still easing monetary policy, buying £44.2bn ($67bn, €60bn) of bonds each month under a programme set to run until at least September 2016. While the head of the ECB attributed the pick-up to the central bank's accommodative monetary policy, he also called for further euro integration, describing it as "necessary to extract all the economies of scale and scope that our union brings".

Monetary policy in eurozone
The euro is starting to bounce back after seven years in the doldrums Reuters

"We will not rest until our monetary union is complete − it is in our interest," he added.

On 30 September, however, data published by Eurostat showed annual inflation for September was running at negative 0.1% − below Draghi's target of just under 2%. This, commentators say, may threaten the effectiveness of the ECB's bond-buying programme.

Analysts: European stocks 'to outperform'

Draghi's comments are in line with forecasts. John Vail, chief global strategist at Nikko Asset Management, for instance, lifted eurozone equities to overweight, as he expects European stocks to rise and outperform over the next six months.

"Eurozone equity prices should rebound after two quarters of weakness, with rising corporate earnings and continued regional economic growth being the main factors," Vail said.

Nikko Asset Management forecasts also pointed to a weakening euro against the dollar.