FRANKFURT – The European Central Bank (ECB) on Thursday decided to leave key interest rates for the euro area unchanged while introducing a series of new measures to boost its pandemic response.
The ECB Governing Council said the eurozone base interest rate will remain at 0.00 percent, with the marginal lending rate and deposit rate remaining at 0.25 percent and minus 0.50 percent, respectively.
“We have kept our key interest rates at historically low levels, so borrowing costs remain low,” the central bank said in a separate statement detailing its coronavirus response.
To support liquidity in the euro area, the ECB decided to further ease conditions on the targeted longer-term refinancing operations (TLTRO III) and introduced a new series of non-targeted pandemic emergency longer-term refinancing operations, namely PELTROs, which will be commencing in May 2020 and maturing in a staggered sequence between July and September 2021.
The newly announced measures added to the central bank’s comprehensive response to the coronavirus crisis, including a 750-billion-euro ($816 billion) pandemic emergency purchase program (PEPP) announced on March 18.
Together with its regular asset purchase program at a monthly pace of 20 billion euros, and an additional 120-billion-euro temporary envelope until the end of the year, the ECB’s planned bond-buying scheme this year has exceeded 1.1 trillion euros.
“The Governing Council is fully prepared to increase the size of the PEPP and adjust its composition, by as much as necessary and for as long as needed,” the central bank said.