European Central Bank
European Central Bank Leaves Policy Settings As Is
July 16, 2020
The European Central Bank’s Governing Council agreed to continue with currently expansive monetary policy settings. According to a released statement, the refinancing rate is zero percent since its last cut of 5 bps in late 2015 and is flanked by a negative 0.50% deposit rate (last cut by 10 bps in September 2019) and a […] More
European Central Bank Expands Stimulus Measures
June 4, 2020
The Governing Council of the European Central Bank left its interest rate structure as is but took further steps towards a more accommodative stance via changes in forward guidance and a big increase of the pandemic emergency purchase program (PEPP), which was raised from EUR 750 billion to EUR 1.35 trillion. The PEPP program will […] More
Strong Equity Rally and Dollar Downtrend Pause
June 4, 2020
Stock markets mostly rose in the Pacific Rim and Europe but only modestly for the most part in contrast to yesterday’s sharp advance. Just prior to the release of U.S. data this morning, U.S. stock futures were suggesting a downtick at the open. The dollar is unchanged from Wednesday closing levels against the euro, yen, […] More
No Fireworks from ECB this Time
April 30, 2020
At a scheduled meeting of the European Central Bank Governing Council, officials left key interest rate unchanged (a 0.0% refinancing rate flanked by a -0.5% deposit rate and a 0.25% marginal lending rate). Quantitative stimulus (asset purchases) was not enhanced beyond last month’s parameters. Terms were relaxed on some lending operations, and a new series […] More
ECB Monetary Policy Review and Some Atrocious Economic Data
April 30, 2020
At a scheduled meeting of the European Central Bank Governing Council, officials left key interest rate unchanged (a 0.0% refinancing rate flanked by a -0.5% deposit rate and a 0.25% marginal lending rate). Quantitative stimulus (asset purchases) was not enhanced beyond last month’s parameters. Terms were relaxed on some lending operations, and a new series […] More
Dollar Down After Fed Expands Currency Swap Network.. Equities Up in Asia and Europe
March 20, 2020
The dollar fell overnight by 2.9% against the Australian dollar, 2.5% relative to the kiwi, 2.2% versus sterling, 2.0% vis-a-vis the loonie, 0.8% against the peso, 0.6% versus the yen and 0.4% relative to the euro and Swiss franc. The swap line arrangement that enables central banks to exchange on a temporary basis their own […] More
Takeaways from ECB Actions and Press Conference
March 12, 2020
The European Central Bank’s second scheduled Governing Council meeting of 2020 produced an interest rate surprise. Despite strongly expected cuts, the marginal lending facility rate of 0.25%, refinancing rate of zero percent, and overnight deposit facility rate of -0.50% were each left unchanged. The last deposit rate cut was made in September 2019, and the […] More
ECB President Lagarde’s Introductory Press Conference Statement
January 23, 2020
The ECB Governing Council’s first policy meeting of 2020 ended as expected with no change in its interest rate structure, including a negative 0.5% deposit rate since a 10-basis point cut last September. The Bank will continue quantitative stimulus of EUR 20 billion per month and, as previously announced by President Lagarde, is beginning a […] More
Coronavirus Spreading and Three Central Banks Review Monetary Policy
January 23, 2020
Share prices slumped another 2.8% in China, 1.5% in Hong Kong, 1.0% in Japan, 0.9% in South Korea, and 0.6% in Australia and Singapore as the deadly pneumonia-like disease centered in Asia claimed more victims. Share prices in Europe are so far today down 0.4% in Germany and 0.3% in the U.K. and Switzerland but […] More
European Central Bank Maintains Ultra Easy Stance
December 12, 2019
The European Central Bank retained its interest rates of zero percent on the repo, a -0.5% overnight deposit rate and a 0.25% marginal lending rate. This was the first scheduled policy review chaired by Christine Lagarde, and the released statement contained the following compelling forward guidance on interest rates and quantitative stimulus: The Governing Council […] More
