The European Central Bank held its benchmark refinancing rate at 0 percent on December 13th and confirmed the end of its €2.6 trillion bond purchase scheme later this month, while it will keep reinvesting cash from maturing bonds for an extended period of time. Policymakers also reiterated they expect key interest rates to remain at record low levels at least through the summer of 2019. Interest Rate in the Euro Area averaged 1.96 percent from 1998 until 2018, reaching an all-time high of 4.75 percent in October of 2000 and a record low of 0 percent in March of 2016.
ECB Warns of Economic Risks, Uncertain Outlook.
ECB officials agreed that the risks to the Euro Area outlook could still be assessed as broadly balanced, but that the balance of risks was moving to the downside owing to the persistence of uncertainties related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial volatility, minutes of the ECB’s December meeting showed. Policymakers also suggested revisiting the contribution of TLTRO to the monetary policy stance moving ahead.