Investing.com - The European Central Bank cut its benchmark interest rate in a surprise decision and lowered its deposit rate deeper into negative territory on Thursday, in an effort to boost inflation in the euro region.
The ECB said it was lowering its benchmark interest rate to a record-low 0.0% from 0.05%, surprising market players who were expecting no change.
The central bank also cut its deposit facility rate to -0.4% from -0.3%, in line with market expectations. Meanwhile, the central bank reduced its marginal lending rate to 0.25% from 0.30%.
The ECB also said it was to increase the size of its monthly quantitative easing program to approximately €80 billion from the current €60 billion, starting in April, with investment-grade bonds added to the mix of assets eligible for purchase.
The central bank also announced new series of four targeted longer-term refinancing operations to be launched in June.
ECB President Mario Draghi was to comment on the decision at a press conference at 13:30GMT, or 8:30AM ET.
EUR/USD was trading at 1.0869 from around 1.0975 ahead of the announcement, while EUR/GBP was at 0.7675 from 0.7721 earlier.
Meanwhile, European stock markets were mostly higher. The EURO STOXX 50 rose 2.8%, France's CAC 40 tacked on 2.5%, Germany's DAX climbed 2.3%, while London’s FTSE 100 inched up 0.6%.