Following the European Central Bank's (ECB) decision to leave its interest rates unchanged, Christine Lagarde, President of the ECB, is delivering her remarks on the monetary policy outlook in a press conference. Key takeaways: "Ambitious effort needed in joint and coordinated policy action." "Determined to support households and firms." "Fully committed to doing everything necessary." "Ensuring monetary policy is transmitted to all countries." "ECB stands ready to adjust all instruments." "Latest data point to unprecedented decline."
ECB tweaks policy but leaves QE unchanged
EUROPEAN CENTRAL BANK EMERGENCY MEASURES
The European Central Bank (ECB) held on Thursday its policy meeting. Analysts at Danske Bank point out the central bank decided not to change the modalities of either the PEPP or the APP in size, composition or similar, however, made a pseudo rate cut for banks in the period between June this year and June next year by lowering the TLTRO rate by 25bp in the period.
The European Central Bank announced on Thursday that it has taken steps to mitigate the impact of possible rating downgrades on collateral availability. Key takeaways: "The ECB to grandfather until September 2021 eligibility of marketable assets used as collateral in the Eurosystem credit operations falling below current minimum credit quality requirements."
ECB latest analysis
ECB LATEST NEWS
April MEETING REVIEW
The European Central Bank has had its say – by leaving the bond-buying program unchanged, far from what is needed. The ECB has disappointed investors and the euro may suffer. The Frankfurt-based institution left the PEPP bond-buying scheme unchanged at €750 billion and only said it is ready to increase it and let it run through the year-end. That is insufficient amid the rapid pace of deploying funds and the gravity of the situation, as data has shown.
The European Central Bank kept its main interest rates unchanged -0.0% as widely expected but in a small surprise declined to increase its bond buying program, putting the decision off until at least the June 4 meeting. There had been modest market anticipation that to help eurozone governments with the skyrocketing economic cost of the Coronavirus outbreak the bank would increase the limits of its pandemic emergency purchase program (PEPP).
January meeting review
A wise owl – that is what Christine Lagarde, President of the European Central Bank aspires to be. She said that back in December and has been wearing an owl pin in the January rate decision. Her press conference seems to be wise – if her intention was not to rock the boat. EUR/USD has maintained its narrow range, with implied volatility digging to new lows.
Commission will use all the tools at its disposal to support economy. As the ECB announced its liquidity boosting measures, EU leaders gave the Commission a mandate to further step up the repsonse to the Coronavirus, or Covid-19 outbreak, on all fonts. On the health front the Commission has announced a series of measures and mobilised EUR 140 bln in public and private funding on research for a vaccine.
December meeting review
At its monetary policy meeting held on December 12th, the Governing Council of the European Central Bank (ECB) decided to leave the interest rates on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility unchanged at 0.00%, 0.25% and -0.50%, respectively, as expected.
October meeting review
Mario Draghi's last press conference as President of the European Central Bank reflects his eight-year tenure – dovish. He expressed pessimism about the current situation. Do not be fooled by the 20-pip rise in EUR/USD – it is related to the US Dollar's weakness – originating from downbeat US Durable Goods Orders for September.
Mario Draghi concluded his final press conference as head of the ECB with an elegy on the success of his eight years as president rather than with advice for his successor Christine Lagarde. He noted that the poplularity of the euro has never been so high, a result , perhaps of his famouns promise to do whatever it takes to save the united curency.