Four months into her new role, the head of the European Central Bank is exploring measures to ease the impact of Covid-19 on business
European Central Bank president Christine Lagarde. Picture: REUTERS/VINCENT KESSLER
An ECB reduction on Thursday should satisfy those expectations and add the eurozone central bank to the list of monetary authorities using rates to shield their economies. But it could also backfire by doing little to address the specific impact of a health emergency, undermining financial stability and reducing policy space the bank might be better off preserving.
Mindful that disruptions to global supply chains and travel are straining cash flows at companies, Lagarde and her 24 governing council colleagues are seen delivering measures to support liquidity when they meet. Options that are likely to be under consideration include incentives for banks to keep funding virus-hit firms.
Lagarde’s pledge to deliver “targeted” measures if needed suggests the ECB may adapt its existing programme of long-term loans to financial institutions or plan a new variant of it. The initiative, which has run on and off since 2014, gives banks an incentive to lend to companies and households, and could probably be tweaked to target small businesses.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Global equities slide as virus-weary traders lose appetite for riskInvestors drive 30-year US bond yields beneath 1% on bets Fed will cut interest rates by at least 75 basis points
Read more »
Global stocks panic as oil price plunges and Covid-19 spreadsInvestors piled into safe-haven bonds, driving the 30-year US bond yields beneath 1% on bets the US Fed will cut interest rates 75 basis points at its March 18 meeting
Read more »
Act now or face a bloodbath, Wall Street urges governments as virus hits marketsAnalysts call for central banks to cut rates and offer to buy risky assets
Read more »
LUKANYO MNYANDA: Coronavirus fallout evokes shades of rand’s crash in early 2000sBets on a Reserve Bank rate cut are increasing amid a clamour for officials to act
Read more »
Pabi Moloi 'truly gutted' following drinking and driving arrestPabi Moloi said she had decided to drive home after having a few drinks last week.
Read more »
Ancelotti’s Everton get a hiding at his old club ChelseaIn-form Everton get cut to pieces at Stamford Bridge
Read more »