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3 years ago
Key Euribor rate falls as Praet pledges policy to remain loose
February 19, 2014 / 10:23 AM / 3 years ago

Key Euribor rate falls as Praet pledges policy to remain loose

3 Min Read

FRANKFURT, Feb 19 (Reuters) - The key euro-priced
bank-to-bank lending rate edged down on Wednesday after a
European Central Bank policymaker said the central bank would
maintain accommodative monetary policy for as long as needed.
    Executive Board member Peter Praet confirmed on Tuesday the
ECB had no plans to tighten policy in the near future, saying
they "really mean it".
    Another policymaker, Governing Council member Ewald Nowotny,
told Reuters that the improving economy and higher German wage
deals could start to "self-correct" inflation rates, which have
lately been well below the ECB's target of just below 2 percent.
    Nowotny also said that a negative deposit rate may fail to
stimulate more lending and could have an adverse psychological
effect. 
    Some policymakers have expressed scepticism about cutting
below zero the deposit rate the ECB pays banks for holding their
money overnight - one of the options the ECB has discussed to
help money flow more evenly across the euro zone.
 
    The three-month Euribor rate, considered the
main gauge of unsecured bank-to-bank lending, ticked down to
0.287 percent from 0.288 percent.
    The six-month Euribor rate was unchanged at
0.386 percent. The shorter-term one-week rate rose
to 0.191 percent from 0.190 percent.
    Excess liquidity, or the amount of money banks
have beyond what they need for their day-to-day operations,
eased to 143 billion euros. The EONIA overnight lending
rate rose to 0.153 percent on Tuesday from 0.150 percent in the
previous session.
    In January, ECB President Mario Draghi said an unwarranted
increase in short-term-money market rates and a worsening of the
medium-term outlook for inflation could trigger more policy
action. 
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
    For a package of graphics on the ECB, click on:     
    link.reuters.com/neg32s   
    For graphic of euro zone liquidity levels click:       
    link.reuters.com/qeq25s 
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
    Euribor rates are fixed daily by the Banking Federation of 
the European Union (FBE) shortly after 1000 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       
    1 month      
    2 month      
    3 month      
    6 month      
    9 month      
    1 year       

 (Reporting by Frankfurt newsroom; Editing by Larry King)

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