Breaking News – The European Central Bank cuts interest rates and introduces a stimulus package in order to support the eurozone economy.
The ECB lowers their inflation forecast – seeing the 2021 inflationary number to be 1.5%.
Economists were expecting a level of support to be provided by the ECB and outgoing Mario Draghi, in order to support the Eurozone economic environment, preventing further slow down, so a cut to -0.5% plus the reintroduction of QE is likely to produce a ‘shot in the arm’ and assist lack lustre European stocks.
Please find below an article from Sky News which is up to the minute, together with a link to Bloomberg
“European Central Bank cuts interest rates for first time since 2016
The ECB will also begin buying bonds at a rate of €20bn a month from November.
By Ed Clowes, business reporter for Sky TV News
Thursday 12 September 2019 13:43, UK
The European Central Bank (ECB) has cut interest rates for the first time since 2016, while introducing a sweeping stimulus package in an attempt to kick-start a lacklustre eurozone economy and stave off recession.
The central bank announced that it had cut its deposit rate by 10 basis points (BPS) to an all-time low of -0.5% and will restart quantitative easing at a pace of €20bn (£17.8bn) a month from November.
In a statement, the bank said that interest rates would “remain at their present or lower levels” until it had seen inflation reach acceptable levels.
The euro fell to its lowest level in more than a week on the news.
A day after accusing the Federal Reserve of being “boneheads”, US President Donald Trump took to Twitter to once again attack the US central bank.
“European Central Bank, acting quickly, Cuts Rates 10 Basis Points” Trump wrote shortly after the announcement.
“They are trying, and succeeding, in depreciating the Euro against the VERY strong Dollar, hurting U.S. exports…. And the Fed sits, and sits, and sits. They get paid to borrow money, while we are paying interest!”, he added.”
As always, if you have a question of a financial nature, simply get in touch.
Richard and the Best Price FS Team
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