European Central Bank keeps rates at historic low
- COMPILED FROM WIRE SERVICES, ISTANBUL
- Mar 08, 2018
The European Central Bank kept its benchmark refinancing rate at a historic low of 0 percent Thursday, signaling greater confidence in the eurozone economy and its own chances of hitting its elusive inflation goal by dropping talk of boosting its mass bond-buying program.
The decision was made on Thursday in the German financial hub of Frankfurt by the eurozone central bank's governing council.
The bank deposit rate was also held at a punitive minus 0.4 percent.
The latest monetary policy statement from the bank's governing council no longer mentioned that policymakers stood ready to increase their 30-billion-euro ($37.1 billion) per month asset-purchasing program "in terms of size or duration" if the global outlook becomes less favorable. The phrase had been included in every communique since December 2016.
"The Governing Council expects the key ECB interest rates to remain at their present levels for an extended period of time," it said in a statement.
The ECB's rate-setting council said in January it planned to continue to buy bonds under its asset purchases program at 30 billion euros (37.2 billion dollars) a month from January and until at least September as it waits for annual inflation to climb towards the bank's target of just below 2 percent.
In February eurozone inflation actually fell to 1.2 percent, its lowest point since December 2016.
The initial monthly 60-billion-euro asset-buying programme expired at the end of 2017.
The council "confirms that the net asset purchases, at the current monthly pace of 30 billion euros, are intended to run until the end of September 2018, or beyond, if necessary, and in any case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its inflation aim," it said.