The European Central Bank cuts interest rates for the fourth time this year
Yesterday Thursday (December 12th), as inflation approached its target and the economy remained weak, the European Central Bank cut interest rates for the fourth time this year and maintained the door to further easing.
The central banks of the 20 countries sharing the euro have lowered the interest rates paid on their bank deposits from 3.25% to 3.0%, which has boosted the financing conditions of the group. In June alone, it set a record of 4.0%.
It also indicates that further cuts are possible by removing the economy that maintains "sufficient limits" on interest rates by removing borrowing cost levels that inhibit economic growth.
The ECB stated that financing conditions are being relaxed as the recent interest rate cuts by the board gradually reduce the cost of new borrowing for companies and households. But they are still very nervous because monetary policy is still restrictive, and past interest rate hikes are still being transmitted to the outstanding credit stock
With Thursday's decision, the European Central Bank will also lower the interest rate for loans to banks within a week to 3.15% and the daily loan interest rate to 3.40%.
In recent years, these measures have been almost unused as the European Central Bank has provided the banking system with more reserves than it needs through large-scale bond purchases and long-term loans.
But as these projects come to an end, they may become more relevant in the future. The European Central Bank confirmed on Thursday that it will stop purchasing bonds under the pandemic emergency purchase program this month.
Tips：This page came from Internet, which is not standing for FXCUE opinions of this website.
Statement：Contact us if the content violates the law or your rights