{"id":27263,"date":"2012-02-09T11:42:00","date_gmt":"2012-02-09T16:42:00","guid":{"rendered":"http:\/\/countingpips.com\/fx\/2012\/02\/09\/european-central-bank-holds-steady-at-1-00\/"},"modified":"2012-02-09T11:42:00","modified_gmt":"2012-02-09T16:42:00","slug":"european-central-bank-holds-steady-at-1-00","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2012\/02\/09\/european-central-bank-holds-steady-at-1-00\/","title":{"rendered":"European Central Bank Holds Steady at 1.00%"},"content":{"rendered":"<p><span><span>The&nbsp;<a href=\"http:\/\/www.ecb.int\/\" target=\"_blank\">European Central Bank<\/a>&nbsp;(ECB) kept its&nbsp;Main refinancing operations rate at 1.00%. &nbsp;ECB governor, Mario Draghi, said: &#8220;<\/span><\/span><span><span><span>Inflation is likely to stay above 2% for several months to come, before declining to below 2%. Available survey indicators confirm some tentative signs of a stabilisation in economic activity at a low level around the turn of the year, but the economic outlook remains subject to high uncertainty and downside risks&#8230;.&nbsp;A very thorough analysis of all incoming data and developments over the period ahead is warranted.&#8221;<\/span><\/span><\/span><br \/><a name='more'><\/a><br \/><span>The ECB previously announced (noting further <a href=\"http:\/\/www.ecb.int\/press\/pr\/date\/2012\/html\/pr120209_2.en.html\">collateral approvals<\/a>) a series of&nbsp;<a href=\"http:\/\/www.ecb.int\/press\/pr\/date\/2011\/html\/pr111208_1.en.html\">measures<\/a>&nbsp;&#8220;to support bank lending and money market activity&#8221;. These measures included longer-term refinancing operations (LTROs), reduction in the reserve ratio to 1% from 2% presently, and increasing collateral availability through reducing the rating threshold for asset-backed securities (ABS), and allowing national central banks to accept bank loans as collateral. Essentially the moves are designed to prevent a freezing up of credit markets and liquidity akin to that seen during the global financial crisis.&nbsp;<\/span><br \/><span><br \/>Previously the ECB cut the interest rate by&nbsp;<a href=\"http:\/\/www.centralbanknews.info\/2011\/11\/european-central-bank-cuts-rate-25bps.html\">25 basis points<\/a>&nbsp;at its November and&nbsp;<a href=\"http:\/\/www.centralbanknews.info\/2011\/12\/ecb-cuts-rate-25bps-to-100-on-euro.html\">December meetings<\/a>. &nbsp;The ECB last increased the&nbsp;<a href=\"http:\/\/www.centralbanknews.info\/2011\/07\/ecb-hikes-monetary-policy-interest-rate.html\" target=\"_blank\">interest rates<\/a>&nbsp;by 25 basis points at its July meeting; pausing in May and June,&nbsp;after raising the rate by 25 basis points to 1.25% in&nbsp;<a href=\"http:\/\/www.centralbanknews.info\/2011\/04\/european-central-bank-lifts-rate-25bps.html\" target=\"_blank\">April<\/a>&nbsp;last year. &nbsp;The Euro Area reported annual HICP inflation of 2.7% in January, 3% in November and October and September, 2.5% in August and July, 2.7% in June (same as May) and above the Bank&#8217;s inflation target of maintaining inflation below, but close to, 2% over the medium term.&nbsp;<\/span><br \/><span><br \/>The&nbsp;<\/span><a href=\"http:\/\/www.economonitor.com\/blog\/2011\/10\/euro-zone%E2%80%99s-leveraged-solution-to-leverage\/\">Euro<\/a><span>&nbsp;Area reported quarterly GDP growth in the September quarter of 0.2% (1.4% y\/y); the same as the June quarter of 0.2%, following a 0.8% increase in the March quarter, and a 0.3% increase in the December quarter of 2010. &nbsp;The Euro (EUR) has weakened by about 3% against the US dollar over the past year, while the EURUSD exchange rate last traded around 1.33<\/span><\/p>\n<p><a href=\"http:\/\/www.centralbanknews.info\/\" target=\"_blank\">www.CentralBankNews.info<\/a><\/p>\n<div><img loading=\"lazy\" decoding=\"async\" width=\"1\" height=\"1\" src=\"https:\/\/blogger.googleusercontent.com\/tracker\/8290544642025682538-2066200098890980238?l=www.centralbanknews.info\" alt=\"\" \/><\/div><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The&nbsp;European Central Bank&nbsp;(ECB) kept its&nbsp;Main refinancing operations rate at 1.00%. &nbsp;ECB governor, Mario Draghi, said: &#8220;Inflation is likely to stay above 2% for several months to come, before declining to below 2%. Available survey indicators confirm some tentative signs of a stabilisation in economic activity at a low level around the turn of the year, &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/www.investmacro.com\/fx\/2012\/02\/09\/european-central-bank-holds-steady-at-1-00\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;European Central Bank Holds Steady at 1.00%&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-27263","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/27263","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=27263"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/27263\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=27263"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=27263"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=27263"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}