The European Central Bank left interest rates unchanged at 4% on 7 September, but it is not clear that they will not be increased to 4.25%\u00a0 soon.<\/p>\n
The ECB is reacting to the increase in perceived risk in financial markets, catalysed by the sub-prime meltdown.\u00a0 At the same time as the hold on rates increase, the ECB provided another \u20ac42 billion to the banking system, whose liquidity has dried up as banks continue to be reluctant to lend to each other, without knowing the scale of losses in the lending markets.<\/p>\n
Unfortunately, it will be some months before the scale and scope of the liquidity crisis might be known, and this will make interest rate decisions more difficult.\u00a0 However, I think it unlikely that they will be brought down this year.<\/p>\n","protected":false},"excerpt":{"rendered":"
The European Central Bank left interest rates unchanged at 4% on 7 September, but it is not clear that they will not be increased to 4.25%\u00a0 soon. The ECB is reacting to the increase in perceived risk in financial markets, catalysed by the sub-prime meltdown.\u00a0 At the same time as the hold on rates increase, …
Continue reading EU rates held at 4%<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[18,11],"tags":[],"class_list":["post-21","post","type-post","status-publish","format-standard","hentry","category-europe","category-interest-rates-and-currencies"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p4hwcd-l","jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/posts\/21","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/comments?post=21"}],"version-history":[{"count":0,"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/posts\/21\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/media?parent=21"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/categories?post=21"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.astraea.net\/blog\/wp-json\/wp\/v2\/tags?post=21"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}