ECB's Monetary Policy Committee is expected to keep rates on hold at
4,25% later today among fears of financial crisis spreading into
Europe, which have increased considerably the odds for a rate cut
before the end of the year.
Although most analysts share the opinion that the ECB will hold rates today, recent events from the US have changed the whole economical context. Some of the biggest names in Wall Street have failed while the whole financial system is threatening with a meltdown of historical proportions and uncertain consequences.
As usual after the decision we will have the very expected Jean-Claud Trichet's speech. Analyst will be focused on any sign of softening in his tone and thus for assessing the possibility and timing of rate cut from ECB.
Check the effect that the meeting will have over the pairs in our Rates and Charts Section or compare the movements of the different banks in our World Interest Rates Table. And remember that you can attend to our special live coverage: "ECB Interest Rates decision Live Coverage with Rob Booker" on Thursday October 2, at 11:15 GMT, both from FXstreet.com home or from the proper event in the Economic Calendar.
In-Depth Analysis
- FX daily Commentary - Will Trichet "Save" Euros Fate or is it All Doom and Gloom? by FXGreece
- ECB: Preview of meeting on October 2 by Danske Bank A/S
- Central European Daily - CE bond markets await the ECB meeting by KBC Bank
- Daily Forex Technical Report - Euro Tumbles ahead of ECB by ActionForex.com
- Trading News Report - ECB Rate Decision on Tap - Can President Trichet Talk Up the Euro? by FXCM
- Flash Comment - ECB: Preview of meeting on October 2 by Danske Bank A/S
- Euroland: ECB to ease faster and more by Danske Bank A/S
- Daily Market Briefing - Euro Tumbles As Weaker CPI Adds to Speculation of ECB Rate Cuts - Will They Do It? by FXCM
- EMU economic indicators - ECB refi rate: reduction because of the financial markets crisis not to be ruled out by BHF-Bank
Related News
- ECB to hold rates, Trichet's take on turmoil key (Thomson Financial News )
- ECB plans to drain up to 200 bln euros from money markets (Thomson Financial News)
- ECB, about to keep rates on hold ahead of market turmoil hitting Europe (FXstreet.com)
- ECB seen on hold but under pressure to soften tone (Thomson Financial News)
- Rising Expectations of ECB Rate Cuts (Dow Jones)
Analysts' comments
- Padhraic Garvey, rate strategist at ING
"He (Trichet) made no direct comments on rates, and this in itself is a concern for those hoping for an ECB rate cut from this week's council meeting. He usually likes to pre-announce his stance, so the best we can hope for is for the pre-announcement process to happen on Thursday. And even that may be a step too far. There is little indication at this point that rate cuts would actually solve anything with respect to the banking crisis." - Reuters - Jean-Claude Trichet, European Central Bank president
"The ECB will continue to support solvent banks' access to liquidity and the functioning of the money market for as long as necessary. The ECB makes a clear separation between, on the one hand, the determination of the monetary policy stance and, on the other hand, its implementation using liquidity operations. The monetary policy stance is determined so as to serve the primary objective of the ECB, namely the maintenance of price stability." - Reuters
