The European Central Bank (ECB) has announced fresh initiatives designed to support the Eurozone economy. These measures focus on maintaining favorable financing conditions and ensuring ample liquidity for businesses and households.

Key Measures

• Pandemic Emergency Purchase Programme (PEPP): The ECB has decided to continue its asset purchases under the PEPP with a total envelope of €1,850 billion. These purchases will continue to be conducted in a flexible manner.
• Targeted Longer-Term Refinancing Operations (TLTRO III): Further adjustments have been made to the conditions of the TLTRO III operations to support bank lending to the real economy.
• Interest Rates: The key ECB interest rates remain unchanged. The interest rate on the main refinancing operations remains at 0.00%, the interest rate on the marginal lending facility at 0.25% and the interest rate on the deposit facility at -0.50%.

Rationale

The ECB stated that these measures are necessary to address the economic impact of current challenges and to support the recovery. The central bank remains committed to using all available instruments to ensure that inflation moves towards its target in a sustained manner.

Looking Ahead

The ECB will continue to monitor the economic situation closely and stands ready to adjust its instruments as appropriate to ensure that the Eurozone economy remains on a path to recovery.