The ECB left its main refinancing operations rate unchanged and lowered the deposit interest rate by 10bps to -0.5 percent during its September meeting. Policymakers also approved a new round of bond purchases at a monthly pace of €20 billion as from November 1st, in as an attempt to boost growth and inflation amid global trade tensions and Brexit uncertainty. The ECB lowered its GDP forecasts to 1.1 percent in 2019 (vs 1.2 percent previously estimated) and 1.2 percent in 2020 (vs 1.4 percent). Inflation expectations were also slashed to 1.2 percent in 2019 (vs 1.3 percent), 1 percent in 2020 (vs 1.4 percent) and 1.5 percent in 2021 (vs 1.6 percent). Interest Rate in Euro Area averaged 1.90 percent from 1998 until 2019, reaching an all time high of 4.75 percent in October of 2000 and a record low of 0.00 percent in March of 2016.

Interest Rate in Euro Area is expected to be 0.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Euro Area to stand at 0.00 in 12 months time. In the long-term, the Euro Area Interest Rate is projected to trend around 0.25 percent in 2020, according to our econometric models.

Euro Area Interest Rate
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Calendar GMT Actual Previous Consensus TEForecast
2019-04-10 11:45 AM ECB Interest Rate Decision 0% 0% 0% 0%
2019-06-06 11:45 AM ECB Interest Rate Decision 0% 0% 0% 0%
2019-07-25 11:45 AM ECB Interest Rate Decision 0% 0% 0% 0%
2019-09-12 11:45 AM ECB Interest Rate Decision 0% 0% 0% 0%
2019-09-23 03:00 PM ECB President Draghi Speech
2019-09-23 05:00 PM ECB Lane Speech
2019-09-24 02:30 PM ECB Guindos Speech



ECB Cuts Deposit Facility Rate, Restarts Bond-Buying

The ECB left its main refinancing operations rate unchanged and lowered the deposit interest rate by 10bps to -0.5 percent during its September meeting. The central bank also approved a new round of bond purchases at a monthly pace of €20 billion as from November 1st, in as an attempt to boost growth and inflation amid global trade tensions and Brexit uncertainty.

The also ECB lowered its GDP forecasts to 1.1 percent in 2019 (vs 1.2 percent previously estimated) and 1.2 percent in 2020 (vs 1.4 percent). Inflation expectations were also slashed to 1.2 percent in 2019 (vs 1.3 percent), 1 percent in 2020 (vs 1.4 percent) and 1.5 percent in 2021 (vs 1.6 percent).

Excerpts from the ECB introductory statement:

First, as regards the key ECB interest rates, we decided to lower the interest rate on the deposit facility by 10 basis points to -0.50%. The interest rate on the main refinancing operations and the rate on the marginal lending facility will remain unchanged at their current levels of 0.00% and 0.25% respectively. We now expect the key ECB interest rates to remain at their present or lower levels until we have seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2% within our projection horizon, and such convergence has been consistently reflected in underlying inflation dynamics.

Second, the Governing Council decided to restart net purchases under its asset purchase programme (APP) at a monthly pace of €20 billion as from 1 November. We expect them to run for as long as necessary to reinforce the accommodative impact of our policy rates, and to end shortly before we start raising the key ECB interest rates.

Third, we intend to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when we start raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.

Fourth, we decided to change the modalities of the new series of quarterly targeted longer-term refinancing operations (TLTRO III) to preserve favourable bank lending conditions, ensure the smooth transmission of monetary policy and further support the accommodative stance of monetary policy. The interest rate in each operation will now be set at the level of the average rate applied in the Eurosystem’s main refinancing operations over the life of the respective TLTRO. For banks whose eligible net lending exceeds a benchmark, the rate applied in TLTRO III operations will be lower, and can be as low as the average interest rate on the deposit facility prevailing over the life of the operation. The maturity of the operations will be extended from two to three years.

Fifth, in order to support the bank-based transmission of monetary policy the Governing Council decided to introduce a two-tier system for reserve remuneration in which part of banks’ holdings of excess liquidity will be exempt from the negative deposit facility rate.

Today’s decisions were taken in response to the continued shortfall of inflation with respect to our aim. In fact, incoming information since the last Governing Council meeting indicates a more protracted weakness of the euro area economy, the persistence of prominent downside risks and muted inflationary pressures. This is reflected in the new staff projections, which show a further downgrade of the inflation outlook.

At the same time, robust employment growth and increasing wages continue to underpin the resilience of the euro area economy. With today’s comprehensive package of monetary policy decisions, we are providing substantial monetary stimulus to ensure that financial conditions remain very favourable and support the euro area expansion, the ongoing build-up of domestic price pressures and, thus, the sustained convergence of inflation to our medium-term inflation aim.


ECB | Joana Ferreira | joana.ferreira@tradingeconomics.com
9/12/2019 1:08:20 PM



Euro Area Money Last Previous Highest Lowest Unit
Interest Rate 0.00 0.00 4.75 0.00 percent [+]
Money Supply M1 8685860.00 8607237.00 8685860.00 444116.00 EUR Million [+]
Interbank Rate -0.42 -0.42 5.39 -0.48 percent [+]
Money Supply M2 12130349.00 12056341.00 12130349.00 1070365.00 EUR Million [+]
Money Supply M3 12768182.00 12678893.00 12768182.00 1097239.00 EUR Million [+]
Foreign Exchange Reserves 75.88 73.27 75.88 34.91 USD Billion [+]
Central Bank Balance Sheet 4674603.00 4681637.00 4708899.00 692641.00 EUR Million [+]
Loans to Private Sector 11338768.00 11289475.00 11338768.00 3241298.00 EUR Million [+]
Deposit Interest Rate -0.50 -0.40 3.75 -0.50 percent [+]
Lending Rate 0.25 0.25 5.75 0.25 percent [+]
Loan Growth 3.40 3.30 9.90 -0.40 percent [+]


Euro Area Interest Rate

In the Euro Area, benchmark interest rate is set by the Governing Council of the European Central Bank. The primary objective of the ECB’s monetary policy is to maintain price stability which is to keep inflation below, but close to 2 percent over the medium term. In times of prolonged low inflation and low interest rates, ECB may also adopt non-standard monetary policy measures, such as asset purchase programmes. The official interest rate is the Main refinancing operations rate. . This page provides - Euro Area Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Euro Area Interest Rate - actual data, historical chart and calendar of releases - was last updated on September of 2019.

Actual Previous Highest Lowest Dates Unit Frequency
0.00 0.00 4.75 0.00 1998 - 2019 percent Daily




Country Last Previous
Argentina 82.79 Sep/19
Turkey 16.50 Sep/19
Mexico 8.00 Aug/19
Russia 7.00 Sep/19
South Africa 6.50 Sep/19
Brazil 5.50 Sep/19
India 5.40 Aug/19
Indonesia 5.25 Sep/19
China 4.20 Sep/19
Saudi Arabia 2.50 Sep/19
United States 2.00 Sep/19
Canada 1.75 Sep/19
Singapore 1.74 Aug/19
South Korea 1.50 Aug/19
Australia 1.00 Sep/19
United Kingdom 0.75 Sep/19
Euro Area 0.00 Sep/19
France 0.00 Sep/19
Germany 0.00 Sep/19
Italy 0.00 Sep/19
Netherlands 0.00 Sep/19
Spain 0.00 Sep/19
Japan -0.10 Sep/19
Switzerland -0.75 Sep/19


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