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Euro sculpture in front of the ECB: penalty interest for excess funds
Photo: A3796 Uwe Anspach / dpa
The European Central Bank (ECB) is sticking to its policy in the face of the third wave of the corona pandemic. The monetary watchdog around central bank chief Christine Lagarde decided on Thursday at their interest rate meeting no new monetary policy stimulus. However, they held out the prospect of adapting all of their instruments if necessary. The ECB had only decided in March to significantly increase the pace of its extensive bond purchases as part of the PEPP emergency program. In doing so, she wants to ensure that financing costs for companies, states and households remain low during the corona crisis.
The central bank left the key interest rate at a record low of 0.0 percent.
It has been there since March 2016. She also did not shake her deposit rate, which is minus 0.5 percent.
This means that financial institutions must continue to pay penalty interest if they park excess funds at the central bank.
The ECB is supporting the eurozone economy during the corona crisis with a variety of monetary policy measures.
The most important weapon in the fight against the economic consequences of the pandemic is the bond purchase program PEPP, which includes government bonds, corporate bonds and other stocks.
It has already been topped up twice and has a purchase limit of 1.85 trillion euros.
The transactions are expected to continue until at least the end of March 2022.
In addition, the central bank has issued extremely cheap, long-term credit injections for banks.
Economists expect that central bank chief Lagarde will argue at the press conference in the afternoon that the ECB must maintain its loose course.
Because an early exit from the crisis measures could endanger the economic recovery.
She had chosen the picture of a patient coming out of a serious crisis, but still dependent on two crutches.
However, the debate about the right time for a somewhat less relaxed monetary policy has already flared up.
Some council members had recently already considered a possible shutdown of emergency bond purchases from the third quarter, should the economy turn on a robust recovery path in the second half of the year.
mik / Reuters