Key Euribor rate steady as policymakers vow to keep rates low
FRANKFURT, Aug 29 (Reuters) - The key Euribor bank-to-bank lending rate held steady on Thursday after European Central Bank policymakers vowed to keep interest rates low for some time as the recovery sets in slowly. ECB Governing Council member Ewald Nowotny said in a panel discussion central banks were giving markets "a certain security" by deploying forward guidance, saying they would keep interest rates low for the foreseeable future. ECB Executive Board member Joerg Asmussen confirmed the ECB's forward guidance of keeping interest rates low or lower for an extended period on Tuesday. The euro zone economy emerged from recession in the second quarter and a survey last week showed business activity across the euro zone picked up this month at a faster pace than expected. German business sentiment surged to its highest level in 16 months in August, data from think-tank Ifo showed on Tuesday. But ECB data on Wednesday showed that loans to the private sector contracted at the fastest pace on record in July. The ECB holds its next policy meeting on Sept. 5. On Thursday, the three-month Euribor rate, traditionally the main gauge of unsecured bank-to-bank lending, stayed at 0.225 percent. The six-month Euribor rate rose to 0.345 percent from 0.344 percent and the one-week rate fell to 0.100 percent from 0.105 percent. The overnight Eonia rate edged down to 0.078 percent from 0.080 percent. Dollar-priced bank-to-bank Euribor lending rates were firmer, with three-month rates rising to 0.50833 percent from 0.50667 percent and one-week rates up at 0.30833 percent from 0.30667 percent. Excess liquidity in the euro zone banking sector stood at 240 billion euros, still high enough to keep short-term market rates below the ECB's refinancing rate. The ECB said in its July monthly bulletin that as long as excess liquidity "remains above a certain threshold, estimated to be in the range of 100 billion to 200 billion euros, short-term money market rates are expected to stay slightly above the deposit rate". A Reuters poll of traders showed last week they did not expect euro zone money market rates to rise significantly even if excess liquidity drops below the 200 billion euro level. The ECB's main refi rate is at 0.5 percent and the deposit rate at zero. Euribor rates are fixed daily by the Banking Federation of the European Union (FBE) shortly after 0900 GMT. * For a table of the latest Euribor fixings for terms of one week to one year, double click on * For a table of the previous day's fixings of EONIA swap rates, which show market expectations for future overnight lending rates, double click on * For graphs of historic Euribor and EONIA swap rates, right click on the links in angle brackets below, and select 'Related Graph' 1 week 2 week 3 week 1 month 2 month 3 month 4 month 5 month 6 month 7 month 8 month 9 month 10 month 11 month 1 year (Reporting by Frankfurt newsroom)
- Putin dissolves state news agency, tightens grip on Russia media
- North Korea says Kim's powerful uncle dismissed for 'criminal acts'
- Thai PM calls snap election, protesters want power now |
- Cold, ice grip U.S. as more snow to blanket East
- Protesters fell Lenin statue, tell Ukraine's president 'you're next'