FRANKFURT (Reuters) - The European Central Bank on Thursday unveiled a large package of measures to stimulate the euro zone economy and boost inflation. Here are the highlights:
- The main refinancing rate, which provides the bulk of liquidity to the banking system, was cut to zero from 0.05 percent.
- The overnight deposit rate, which is paid to banks that keep their money with the ECB, was cut to -0.4 percent from -0.3 percent, meaning banks are paying to deposit.
- The rate for the marginal lending facility, which offers overnight credit to banks, was cut to 0.25 percent from 0.3 percent.
ASSET PURCHASES (QUANTITATIVE EASING)
- Monthly asset purchases were raised to 80 billion euros from 60 billion euros.
- Investment grade euro-denominated bonds issued by non-bank corporations established in the euro area will be included in the list of assets that are eligible for regular purchases.
- There will be a new series of four targeted longer-term refinancing operations (TLTRO II) to be conducted quarterly from June 2016 to March 2017.
- Each will have a maturity of four years, with the possibility of repayment after two years.
- Loans will be offered at the ECB’s main refinancing rate, currently zero.
- ECB President Mario Draghi said banks that lend more to companies and households will be given a discount.
- The maximum reduction will bring the loan rate for banks to that on the ECB’s deposit facility, currently -0.4 percent.
Compiled by Jeremy Gaunt; Editing by Catherine Evans
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