ECB Maintains Record-Low Interest Rates; Markets Anticipate Draghi’s Insight

The European Central Bank (ECB) announced on Thursday that it would maintain its record-low interest rates and introduce no new measures, marking its first policy decision since the United Kingdom’s decision to exit the European Union.

The ECB confirmed that its main interest rate would remain at a historic low of 0.0%, aligning with market expectations. Additionally, the central bank’s deposit rate remained unchanged at -0.4%, while the marginal lending rate continued at 0.25%.

In its press release, the Governing Council indicated that it anticipates the key ECB interest rates will be held at current levels or lower for an extended duration, outlasting the timeframe of asset purchases.

The ECB also decided to keep its monthly quantitative easing program at approximately €80 billion. The authority reiterated that these asset purchases are intended to continue until the end of March 2017, or beyond if necessary, and until there is a sustained shift towards inflation in line with its targets.

Following the announcement, traders shifted their focus to ECB President Mario Draghi’s remarks scheduled for 13:30 GMT (8:30 AM ET). Market participants are particularly interested in any updates regarding the ECB’s economic forecasts.

Prior to the announcement, the euro was trading at 1.1019, slightly up from around 1.1016, while another currency traded at 0.8361, up from 0.8360.

In the meantime, European stock markets generally experienced declines, with the benchmark index falling by 0.15%. France’s index declined by 0.29%, Germany’s index edged down by 0.02%, and London’s index dropped by 0.40%.