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European Central Bank holds; Draghi remarks eyed

Published 06/08/2017, 07:50 AM
© Reuters.  European Central Bank holds; Draghi remarks eyed
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Investing.com - The European Central Bank left its interest rates unchanged on Thursday, in a widely anticipated decision and omitted guidance that interest rates may be cut again.

The ECB kept its rate on bank overnight deposits, which is currently its primary interest rate tool, at -0.40%.

The main refinancing rate was unchanged at zero while the rate on the marginal lending facility, or emergency overnight borrowing rate for banks, stayed at 0.25%.

The ECB said that it expects policy rates to remain “at present levels” for an extended period of time, and well past the horizon of the net asset purchases.

In previous statements, the ECB said it expected policy rates to remain “at present or lower levels” for an extended period.

It also repeated that its €60 billion per month asset purchase program could be increased or extended if the outlook for the euro zone becomes less favorable.

Market participants were turning their attention to ECB President Mario Draghi's press conference at 12.30 GMT, for the banks assessment of the euro area economy.

EUR/USD was at 1.1235 by 11.45 GMT from around 1.1239 ahead of the announcement, while EUR/GBP was at 0.8686 from around 0.8680 earlier.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.21% to 96.88, holding above Wednesday’s seven-month nadir of 96.45.

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