Wednesday, October 2, 2013

ECB holds refi rate steady at 0.5% as expected

    The European Central Bank (ECB) held its refinancing rate steady at 0.50 percent, as expected, along with its other main rates.
    ECB President Mario Draghi will comment on the governing council's decision later today at a news conference in Paris where the ECB council met today. Twice a year the ECB meets in cities outside its Frankfurt headquarters.
    Last month Draghi acknowledged that the council discussed cutting the refi rate, which has been steady since a cut in May, and repeated that it expects its policy stance to remain accommodative "for as long as necessary" and it expects to keep its rates at the current or lower level for "an extended period of time."
    Inflation in the euro area eased to 1.1 percent in September from 1.3 percent in August, below the ECB's target of inflation below but close to 2.0 percent.
    The economy exited recession in the second quarter with Gross Domestic Product rising by 0.3 percent quarter-on-quarter, following six consecutive quarters of contraction. On an annual basis, GDP shrank by 0.5 percent.
    The euro area's unemployment rate remained steady at 12.0 percent in August from July.


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