Draghi Takes ECB Deposit Rate Negative in Historic Move
The European Central Bank cut its deposit rate below zero
and said it would announce further measures later today as policy makers try to
counter the prospect of deflation in the world’s second-largest economy.
ECB President Mario Draghi reduced the deposit rate to minus
0.10 percent from zero, making the institution the world’s first major central
bank to use a negative rate. Policy makers also lowered the benchmark rate to
0.15 percent from 0.25 percent.
The promise of further measures today “has stoked up hopes
that the ECB is going to unleash a huge bazooka on the market in the press
conference,” said Philip Shaw, chief economist at Investec Securities Ltd. in
London. While he thinks that quantitative easing is “very unlikely” now, “it
may well be that what the ECB just said is stoking up hopes that QE could be on
the cards after all...”
at http://dollarcollapse.com/currency-war-2/welcome-to-the-currency-war-part-16-interest-rates-go-negative/
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