Published:  01:04 AM, 10 October 2019

ECB's de Guindos raises bar for further rate cuts

ECB's de Guindos raises bar for further rate cuts -Luis de Guindos

The European Central Bank's vice-president on Wednesday raised the bar on further interest rate cuts, saying the side effects of the ECB's easy money policy were becoming more tangible.

In an interview with Market News, Luis de Guindos also ruled out a "policy U-turn" under the ECB's incoming president Christine Lagarde and weighed in on a public spat among policymakers on last month's decision to resume a 2.6 trillion euro bond-buying program.

The ECB pushed its deposit rate further into negative territory on Sept. 12 - effectively increasing a charge on banks' idle cash - and investors have priced in a further rate cut by March next year.

But de Guindos poured cold water on such expectations. "My impression is that -0.50% is the correct level at present, and as to any further cut, we will have a good, in-depth discussion in the Governing Council," de Guindos said.

--Reuters, Berlin



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