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NewsBreak: ECB to Restart QE from November, Cuts Deposit Rate to -0.5%

Published 09/12/2019, 07:23 AM
Updated 09/12/2019, 08:33 AM
© Reuters.

Investing.com -- The European Central Bank said Thursday it will restart its purchases of government bonds in an attempt to support a slowing eurozone economy. It also cut its deposit rate by 10 basis points to a new record low of -0.5% and said it would introduce a new regime to spare banks some of the pain of negative rates.

Key decisions:

  • Deposit rate cut to -0.5% from -0.4%; first cut since March 2016

  • Main refinancing rate left unchanged at 0%

  • TLTRO pricing to be linked to deposit rate for banks that meet lending criteria

  • Bond purchases to start in November at a rate of 20 billion euros ($22 billion) a month and to run "for as long as necessary".

  • EUR/USD at $1.0969 vs $1.1023 immediately before the announcement.

Latest comments

Germany is in a great recession, the euro is deeply in trouble !!!
your right the euro has been bearish
Maruti Suzuki target please
they want cash circulating in the streets but savers will stuff it in their mattresses
How many times are they going to try this. If it hasn't worked by now with all of the negative interest rates around the world. It will never work you need a recession period. The garage needs to be flushed out of the system
France 10y bond looks good range -0.358 to -0.437 can test the levels of 0.095 support at -0.425 . long term
Spain 10y bond looks good range 0.134 to 0.054 can test the levels of 0.576 support at 0.010. long term
Germany 10y bond looks good range -0.642 to -0.703 can test the levels to -0.200 support at -0.810. long term
Question for the specialists: if for 10 years ECB and perhaps the US Fed have been doing QE and the economic improvement is insignificant shouldn't they try some new ideas?If I pour water in my gas tank and the car won't start, after 19 years I might think to try something new.
Economic improvement insignificant ? Wall Street is near a all time high, unemployment is at a all time low. The worst R/E collapse has recovered. How insignificant is that ?
Unless your goal is to transfer more taxpayer backed money to banks and corporations.
If it is as rosy as you say it is, then what is the need for more QE?
Liquidity is between two state of mind. If X wants to lend but Y does not want to borrow to start or expand business because of fear in economic slowdown, this policy may not work well this time. In my opinion, this policy is based on hope, hope that confidence in the economy may be restored. Central Banks are letting themselves run out of ammunition before GDP numbers show a recession. Before Lehman collapse, they were slow to react and "no one saw it coming". Now, they try to anticipate but wrong timing.
worthless, pointless ... impotent
there is no alternative to this. other than maybe the total colapse of the euro bloc that would have catastrophic consequences for euro zone area.
significant impact on the the EUR forex traders all cashing out on the bearish
beginning of the end for the ECB.
lmao cheap money is what got them there in the first place. if only they had better idea other than printing more money, they wouldn't be where they are now.
So how would a mastermind like you, would have solved the economic problems of Europe ?, only if Turtle_Steven would be in charge of the ecb we would have a flourishing EU
dump government solutions, embrace the free market. problem solved
Sure, like in 1929, right?
Banks shears will go up thats good news bcoz all Europe banks shears almost 60% down last 2016
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