World Business News

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ECB cuts rates and launches €400bn lending boost

Zone(s): Europe ¦ Sector(s): Finance, Banking
[5 June 2014, New Model Adviser] By Daniel Grote: The European Central Bank (ECB) has announced a cut to interest rates and a new €400 billion (£323 billion) programme to boost bank lending as it acts to ward off deflationary pressures.

The ECB has cut its main rate, which is used as a benchmark for consumer borrowing, from 0.25% to 0.15%. And it has entered unchartered territory by introducing a negative deposit rate, of -0.1%, meaning banks will be charged to park their cash with it. The rate for the ECB’s marginal lending facility has also been cut, from 0.75% to 0.40%. ECB president Mario Draghi said rates were likely to remain at those levels ‘for an extended period of time in view of the current outlook for inflation’.

Read more:
citywire.co.uk/new-model-adviser/ecb-cuts-rates-and-launches-400bn-lending-boost/a754852?ref=new-model-adviser-latest-news-list