Editor's PiCK
European Central Bank cuts key interest rate by 0.25 percentage points… 7 consecutive rate cuts
Summary
- The European Central Bank (ECB) announced it has cut its policy rate by 0.25 percentage points, marking the seventh consecutive rate cut.
- As a result, the gap between the ECB rate, the Fed rate, and the Bank of Korea’s key rate has widened.
- The ECB has also lowered its Eurozone inflation and economic growth forecasts for this year.
The European Central Bank (ECB) has cut its policy rate by 0.25 percentage points.
On the 5th (local time) in Frankfurt, Germany, the ECB held its monetary policy board meeting and announced it had lowered the deposit rate from 2.25% to 2.00% per annum and the key interest rate from 2.40% to 2.15% per annum, respectively.
The marginal lending rate was also reduced from 2.65% to 2.40% per annum.
Since last September, the ECB has cut its policy rate at all seven of its meetings.
As a result, the gap between the ECB’s monetary policy anchor, the deposit rate, and the Fed’s benchmark rate (4.25–4.50%), has widened to 2.25–2.50 percentage points. The gap with the Bank of Korea’s key rate of 2.50% is 0.50 percentage points.
Furthermore, the ECB revised this year’s Eurozone consumer price inflation outlook down from 2.3% to 2.0%, and next year’s from 1.9% to 1.6%.
This year’s growth forecast remains at 0.9%, while next year’s was lowered from 1.2% to 1.1%.
Bobe Lee, contributing reporter for Hankyung.com newsinfo@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
