European Central Bank holds rates and trims its inflation forecast
Publishing timestamp: 2023-12-14 11:37:18
Summary
The European Central Bank (ECB) has decided to hold interest rates steady for the second meeting in a row. The ECB also revised its growth forecasts lower and announced plans to shrink its balance sheet. The bank's decision was expected due to the sharp fall in euro zone inflation. The ECB's future decisions will ensure that policy rates remain restrictive for as long as necessary. The bank also switched its language around inflation, stating that it will decline gradually over the course of the next year. The ECB's staff projections show lower GDP expansion and inflation rates compared to previous forecasts. The bank cautioned that domestic price pressures remain elevated, primarily due to the growth in the cost of labor. The ECB also announced that reinvestments under its pandemic emergency purchase program would complete at the end of 2024. The transition will be gradual, with a reduction in the program's portfolio. The ECB's decision keeps the key rate at a record high of 4%.
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Keywords: business news, economy, markets, stoxx 600, breaking news: europe, central banking, politics, inflation,
Source: https://www.cnbc.com/2023/12/14/european-central-bank-holds-rates-trims-growth-forecasts.html