In April 2011, the ECB raised interest rates for the first time since 2008 from 1% to 1.25%, with a further increase to 1.50% in July 2011. However, in 2012–2013 the ECB sharply lowered interest rates to encourage economic growth, reaching the historically low 0.25% in November 2013. 2 days ago Jens Weidmann, European Central Bank (ECB) Governing Council member and Bundesbank President, said on Wednesday that the ECB’s Pandemic Emergency Purchase Programme (PEPP) is flexible. Additional takeaways “Deposit rate cut is one of ECB’s tools.” “The size of the yield moves is not particularly worrisome.”.
Jens Weidmann, European Central Bank (ECB) Governing Council member and Bundesbank President, said on Wednesday that the ECB’s Pandemic Emergency Purchase Programme (PEPP) is flexible.
Additional takeaways
“Deposit rate cut is one of ECB’s tools.”
“The size of the yield moves is not particularly worrisome.”
“ECB looking at conditions beyond government bond yields.”
Market reaction
Ecb Negative Rates
The shared currency remains on the back foot following these comments and continues to weaken against its major rivals. As of writing, the EUR/USD pair was down 0.32% on the day at 1.2050.