The CEOs of the European Central Bank reduced the main interest rates with 25 base points – it was stated in the announcement after the meeting. EBC has no longer used the term “restrictive” in relation to the feet.
Interest rates deposit at the central bank, basic refinancing operations and credit at the central bank will be reduced by Thursday's decision, to 2.25 percent, respectively, 2.40 percent. and 2.65 percent
The decision was in line with the expectations of the respondents by the Bloomberg agency. In this cycle of monetary policy, the deposit rate has already been reduced by 150 PB.
Reasons for reduction
“The disinflation process is clearly progressing. Inflation is still shaping as expected by experts: in March, both total inflation and base inflation have decreased. Inflation of service prices in recent months also decreased significantly” – we read in the message.
However, as added, despite the fact that “the eurozone's economy takes on a certain resistance to global shocks”, “the prospects of economic growth have deteriorated because of increasing commercial tensions.”
According to ECB, growing uncertainty can undermine investors' trust and market response to these factors may have a “strengtent” effect.
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