Banking
ECB cuts rates to ward off eurozone deflation threat
The ECB cut its main refinancing rate to 0.05 percent from 0.15 percent. ECB President Mario Draghi had said after the ECB's last rate cut in June that "for all the practical purposes, we have reached the lower bound".
In a landmark speech on 22 August, however, Draghi said indications from financial markets showed inflation expectations "exhibited significant declines at all horizons" in August.
Euro zone inflation slowed to 0.3% last month, sinking deeper below the ECB's target of just under 2% and raising the spectre of deflation in the eurozone.
On Thursday, the ECB also said it had lowered the rate on bank overnight deposits to -0.20%, which means banks pay to park funds at the central bank, and cut its marginal lending facility - or emergency borrowing rate - to 0.30%.
Markets now turn their attention to ECB President Mario Draghi's 1230 GMT (0930 EDT) news conference, at which he is expected to give a more detailed explanation of the ECB's decision.
Share this article:
EU Reporter publishes articles from a variety of outside sources which express a wide range of viewpoints. The positions taken in these articles are not necessarily those of EU Reporter. Please see EU Reporter’s full Terms and Conditions of publication for more information EU Reporter embraces artificial intelligence as a tool to enhance journalistic quality, efficiency, and accessibility, while maintaining strict human editorial oversight, ethical standards, and transparency in all AI-assisted content. Please see EU Reporter’s full A.I. Policy for more information.
Counterfeit cigarettes drive illicit tobacco trade to highest level in a decade, new study claims
High-speed drama shatters Monaco’s tranquil façade
Libya’s fuel crisis offers lessons for energy security on both sides of the Mediterranean
EU agri-food trade surplus expands in February 2026
Commission disburses €7.2 billion to Poland under NextGenerationEU
Spring semester package: Steering EU economies to increased competitiveness
Africa CDC urges protection for Ebola aid workers
EU and Moldova strengthen cooperation on jobs, skills and social rights
Commission endorses Lithuania’s €884 million Social Climate Plan to support vulnerable households and micro-enterprises in the clean transition
New EU rules on pay transparency explained
Record breaking Belgian sailors making more waves
Message to Kemi Badenoch: 'Make a splash by thinking out-of-the-box on UK-Europe relationship'
Kazakhstan cuts water use by 874 mln m³ through new technologies
Europe's peripheral and maritime regions 'combine many territorial assets', meeting told
Inconvenient questions about Andorra and San Marino that Brussels should be asking
How digital wallets are changing the way Welsh consumers pay for online services
Kazakhstan reforms under scrutiny at Brussels Press Club round table
Japan should face up to history and contribute more to regional peace
Ambassador calls for 'speeding up' of co-operation between EU and Kazakhstan
Timur Turlov at Smart Moves Summit 2025: How chess can transform global education
Shevtsova’s case: Out-of-court sanctions dismantling trust in Ukrainian cause
The future of European transport
Trump Vs Trueman
US 'no longer' an 'unconditional ally' for Europe - MEP
-
Health3 days agoCounterfeit cigarettes drive illicit tobacco trade to highest level in a decade, new study claims
-
France5 days agoHigh-speed drama shatters Monaco’s tranquil façade
-
Libya3 days agoLibya’s fuel crisis offers lessons for energy security on both sides of the Mediterranean
-
Agriculture4 days agoEU agri-food trade surplus expands in February 2026