European Central Bank

75-Basis Point ECB Rate Hike

September 8, 2022

An initial 50-basis point interest rate hike at the European Central Bank in July has been followed by a 75-bp  hike at this month’s scheduled meeting. The three interest rates now included a 1.25% refinancing rate flanked by a 0.75% deposit rate and a 1.50% marginal lending facility rate. Prior to July, there had not […] More

Concern about European Economic Outlook Mounting

September 8, 2022

The record 75 basis point increase in European Central Bank interest rates failed to lift the euro, which continues to trade below dollar parity. Europe’s economy is more exposed than others to Russia’s invasion of Ukraine. Britain’s new prime minister, Liz Truss, has imposed an emergency freeze on gas and electricity rates. The weighted dollar […] More

ECB Negative Deposit Rate Ended

July 21, 2022

The European Central Bank’s three key interest rates were raised by 50 basis points, not the 25 bps that it was expecting to go when the previous policy meeting was held in early June. The new rate configuration is a 0.50% refinancing rate, flanked by a zero percent deposit rate and a 0.75% marginal lending […] More

ECB Flags Interest Rate Normalization to Counter Above-Target Inflation

June 10, 2022

Yesterday’s scheduled meeting of the European Central Bank’s Governing Council made news, pre-announcing a likely 25-basis point rise in policy interest rates (currently a zero percent refinancing rate flanked by a negative 0.5% deposit rate and a 0.25% marginal lending facility rate). In addition, a released statement flagged a likely rate hike of more than […] More

European Central Bank Not as Hawkish as Feared

April 14, 2022

At this week’s meeting of the European Central Bank Governing Council, policymakers as expected speeded up the planned wind-down of monthly asset purchases, but the overall tone of the decision reads less hawkishly than expected. Planned asset purchases had previously been set at EUR 40 billion per month all this quarter and at EUR 30 […] More

ECB Surprise, a Diplomatic Failure, and Many Price Data Releases

March 10, 2022

In light of risks posed by Russia’s invasion of Ukraine, today’s European Central Bank policy review was not expected to push ahead with its QE exiting strategy, but in fact the pace of the phase-out of asset purchase program bond buying was stepped up: EUR 40 billion will be bought next month, then EUR 30 […] More

ECB Minutes

March 3, 2022

Published minutes from the European Central Bank policy review in early February declare that “compared with the assessment in December, upside risks to the inflation outlook had increased, particularly in the near term. As the increase in inflation was becoming longer-lasting than initially expected, it was remarked that the Governing Council should avoid characterizing inflation […] More

Lessening Quantitative Monetary Support by the European Central Bank

December 16, 2021

The European Central Bank Governing Council left its three main interest rates (a zero percent refinancing rate flanked by a deposit rate of -o.50% and an MLR facility rate of 0.25% unchanged but authorized changes in its quantitative stimulus with the net effect of lessening the degree of accommodation. Projected GDP growth was revised upward, […] More

U.S. GDP, Monetary Policy Statements from ECB & Japan, and So Much More

October 28, 2021

Financial market activity overnight: The dollar and 10-year sovereign debt yields are little changed on this busy Thursday. Equities fell in Asia including losses of 1.2% in China, 1.0% in Japan, 1.2% in Indonesia, and 1.9% thus far in India. European share prices have risen a bit, however, and U.S. futures are also in the […] More

ECB Changes Forward Policy Guidance

July 22, 2021

At today’s scheduled European Central Bank Governing Council meeting, news was made even though the interest rate structure (a zero percent refinancing rate of zero percent since September 2 the quantitative stimulus. A change in expressed guidance over what to expect from the bank’s policy in the future, officials now say that interest rates will […] More