ECB: Interest rates unchanged, signal for new measures in December

The ECB kept the key euro levels unchanged, announcing new measures in December to support the eurozone economy, noting that the risks are now clearly downward. ” “carefully assess the latest information, including the dynamics of the pandemic, the prospects for vaccine marketing and exchange rate developments,” the ECB said in a statement following its Governing Council meeting. The new macroeconomic forecasts will allow a “On the basis of this updated assessment, the Board of Directors will redefine the tools at its disposal to respond to the evolving situation and to ensure that the financial conditions remain favorable for the financial support recovery and address the negative impact of the pandemic on the projected course of inflation. This will strengthen the convergence of inflation towards its target in a sustainable way, harmonized with its commitment to symmetry “, the ECB emphasizes. Monetary Policy Decisions In the meantime, the Governing Council of the ECB has taken the following monetary policy decisions: (1) The interest rate on the main refinancing operations as well as the interest rate on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.50% respectively. The Governing Council expects key ECB interest rates will remain at their current or lower levels until they find that the outlook for inflation is strongly converging to a level close, sufficiently but below 2%, within the time horizon it is considering and that this convergence is reflected in a way consistent with the dynamics of underlying inflation. (2) The Board of Directors will continue to make purchases under the extraordinary program. pandemic emergency purchase program (PEPP), the total amount of which amounts to 1,350 billion euros. These markets help to loosen the overall direction of monetary policy, thus helping to offset the downward impact of the pandemic on projected inflation. Markets will continue to be flexible in terms of time, asset categories and countries. . In this way, the Governing Council will be able to effectively prevent the risks to the smooth transmission of monetary policy. The Board of Directors will reinvest the funds from the repayment of securities acquired under the PEPP at their expiration at least until the end of 2022. In any case, the future gradual reduction (roll- of the PEPP portfolio will be adjusted to avoid interference in the appropriate direction of monetary policy. (3) Net purchases under the asset purchase program (APP) will continue at € 20 billion per month, in combination with the markets under the additional financing of 120 billion euros, which The Board of Directors continues to expect that the monthly net purchases of assets under the APP program will be made for as long as necessary to enhance the easing effect of its policy interest rates and that they will expire shortly. The Governing Council intends to continue to fully reinvest the amounts due from the repayment of securities acquired under the APP program at maturity, for an extended period after the date on which it will begin to increase. key interest rates of the ECB and for as long as necessary to maintain favorable liquidity conditions and a largely facilitative monetary policy nature. (4) The Governing Council will also continue to provide ample liquidity through refinancing operations performs. More specifically, the third in a series of targeted longer-term refinancing operations (SPMA III) continues to be an attractive source of financing for banks, supporting bank lending to businesses and households. Follow it on Google News and get the latest news from Greece and the World, at

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