The European Union should have stepped in earlier than it did with a rescue package for Greece, European Central Bank board member Nout Wellink said on Friday.

They should have stepped in earlier. Let me also say, they should have stepped in years ago. Greece ran a budget deficit for years, Wellink told reporters.

There should have been peer pressure on Greece years ago... The whole country lived beyond its means and the public sector lived beyond its means, Wellink said.

But Wellink, who is also governor of the Dutch central bank, said it was too early to talk about further expansion of the European Union's massive package to aid countries unable to cope with ballooning debt.

It seems to me a little bit early to talk about further expansion, Wellink said.

He said the most important part of the package is that the Germans decided to really support the euro. Otherwise they wouldn't have been prepared to take part in this huge programme.

Current market uncertainty was reflected in increased use of the ECB's deposit facility, but inflation expectations in the euro zone were better anchored than in the United States, he also said.

For a fair assessment you have to consider that inflation expectations are anchored more solidly in Europe than in the U.S., Wellink said. (Reporting by Boris Groendahl, editing by John Stonestreet)

Inflation