Arab Today, arab today ecb holds rates steady despite french euro worries
Last Updated : GMT 12:16:09
Arab Today, arab today
Arab Today, arab today

ECB holds rates steady despite French euro worries

Arab Today, arab today

Arab Today, arab today ECB holds rates steady despite French euro worries

Frankfurt - AFP

The European Central Bank held its key interest rates steady Thursday and hit back at French concern that the euro\'s recent strong rise poses a threat to recovery in the single currency area. As widely predicted by analysts and ECB watchers, the central bank\'s policy-setting governing council voted to leave the main refinancing rate at a historic low of 0.75 percent, where it has been since July. No ECB watcher had been expecting the central bank\'s chief Mario Draghi to announce any new policy measures, either in terms of interest rates or emergency anti-crisis measures, given the scope and extent of its previous actions. And Draghi told a news conference that the decision not to alter rates had indeed been \"unanimous\" in view of the assessment that inflationary pressures are likely to remain contained in the 17 countries that share the euro and the region\'s economy should start recovering gradually later this year. In addition to bringing down eurozone borrowing costs to their current record low, the ECB has pumped more than 1.0 trillion euros ($1.3 trillion) into the banking system via so-called LTROs to avert a disastrous credit crunch. And it has also constructed a special new mechanism, labelled OMT, to buy up the sovereign bonds of the most vulnerable countries. Draghi said its extensive armoury had indeed proven effective in helping the euro area turn the corner in its three-year-long crisis. Eurozone banks have already repaid early a large chunk of their emergency loans and \"this reflects the improvement in financial market confidence,\" he said. Furthermore, the anticipated recovery in the eurozone economy \"in the second half of the year\" was largely thanks to the ECB\'s \"accommodative monetary policy stance,\" he said. \"All actions we\'ve taken will in the end find their way into the economy, so much so that we see gradual recovery in the second half of this year,\" Draghi said. The ECB chief rejected concerns raised in France this week that the recent rise in the euro to its highest levels in over a year could trample the still tender green shoots of recovery. \"The appreciation is in a sense a sign of return of confidence in the euro,\" Draghi argued. \"By and large, both the nominal and real effective exchange rates are on ... or about their long term averages,\" he said, insisting that \"the exchange rate is not a policy target.\" The comments appeared to be directed at French President Francois Hollande who on Tuesday called for the eurozone to manage the euro\'s exchange rate. Speaking at the European Parliament in Strasbourg, Hollande said \"a single currency zone must have a foreign exchange policy otherwise it will see an exchange rate imposed on it (by the markets) which is out of line with its real competitive position.\" Draghi retorted: \"I think we should always remember that the ECB is independent ... let me say, we heard all over the world talking up, talking down currencies. The ultimate judgement of the effectiveness of this strategy is to see what markets make of these statements.\" Germany, too, sees no cause for alarm in the euro\'s current level of around $1.35, arguing that from an historical point of view, the euro is currently not overvalued and that the recent rise is a counter-reaction to the massive depreciation in the wake of the eurozone crisis. Analysts said the ECB would not be drawn into cutting rates still further to counter the negative impact of the euro\'s strength, at least for now. \"The ECB has no intention to intervene at this stage, not even verbally. It will wait to see some negative impact of the appreciation of the euro on growth and inflation before it feels it needs to act,\" said Marie Diron at Ernst and Young Eurozone Forecast. \"The appreciation of the euro has occurred simultaneously (and partly reflects) improved confidence in the eurozone\'s future. This is positive and to the extent that it allows companies to start investing and hiring again, the negative impact of the stronger exchange rate should be moderate,\" she said. IHS Global Insight economist Howard Archer said that while he felt there was a compelling case for the ECB to cut rates further to 0.50 percent, \"we doubt that it will do so. \"Instead, we suspect the ECB is likely to keep the rate at 0.75 percent through 2013 and, very possibly 2014 as well,\" the expert concluded.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today ecb holds rates steady despite french euro worries Arab Today, arab today ecb holds rates steady despite french euro worries

 



Arab Today, arab today
Arab Today, arab today Fadi Kataya explains secrets of  Nancy Ajram's newlook
Arab Today, arab today Messi visit will contribute in tourism

GMT 14:04 2017 Friday ,24 February

Messi visit will contribute in tourism
Arab Today, arab today Expresses Algerian history by woody figures

GMT 13:26 2017 Friday ,24 February

Expresses Algerian history by woody figures
Arab Today, arab today Iran complying with nuclear deal

GMT 07:14 2017 Saturday ,25 February

Iran complying with nuclear deal
Arab Today, arab today Zainab al-Maliki reveals herTV presenter models

GMT 18:12 2017 Friday ,24 February

Zainab al-Maliki reveals herTV presenter models
View News in Arabic - Business: مصارف
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Actress Lobna Abdel Aziz proud of her career

GMT 06:08 2017 Thursday ,23 February

Actress Lobna Abdel Aziz proud of her career
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 07:36 2017 Wednesday ,22 February

Wafaa Amer is happy for Sherihan’s return

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 20:33 2017 Friday ,17 February

To release new antiques collection

GMT 10:20 2017 Thursday ,23 February

Brazil's top diplomat resigns

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday