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Since 1 January 1999 the European Central Bank (ECB) has been responsible for conducting monetary policy for the euro area - the world’s largest economy after the United States.

Articles by European Central Bank

Meeting of 9-10 December 2020

5 days ago

Account of the monetary policy meeting of the Governing Council of the European Central Bank held in Frankfurt am Main on Wednesday and Thursday, 9-10 December 20201. Review of financial, economic and monetary developments and policy optionsFinancial market developmentsMs Schnabel reviewed the financial market developments since the Governing Council’s previous monetary policy meeting on 28-29 October 2020.Developments in global financial markets had been driven by a strong improvement in risk sentiment. The main catalyst had been the news on the effectiveness and imminent roll-out of multiple coronavirus (COVID-19) vaccines. Two additional factors had reinforced and amplified the improvement in risk sentiment. First, there were growing signs of a forthcoming bipartisan fiscal stimulus

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ECB digital euro consultation ends with record level of public feedback

6 days ago

PRESS RELEASE13 January 2021Over 8,000 responses received in online survey Privacy, security and pan-European reach ranked highest in European citizens’ preferencesDetailed analysis to be published in spring, ahead of decision on project launchThe European Central Bank (ECB) concluded its public consultation on the digital euro yesterday and will now analyse in detail the large number of responses. 8,221 citizens, firms and industry associations submitted responses to an online questionnaire, a record for ECB public consultations. The public consultation was launched on 12 October 2020, following the publication of the Eurosystem report on a digital euro. The ECB will publish a comprehensive analysis of the public consultation in the spring, which will serve as an important input for the

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Isabel Schnabel: Interview with Der Standard

7 days ago

INTERVIEWInterview with Isabel Schnabel, Member of the Executive Board of the ECB, conducted by Andras Szigètvari on 7 January 2021 und published on 12 January 2021 12 January 2021Is there still such a thing as inflation?Inflation is not dead. Compared with the long course of economic history, inflation has only been as low as it is now for a relatively small number of years. And just because we are now in a phase when a particular phenomenon does not appear is no reason for assuming that it no longer exists. What evidence do you have for this? The fact that inflation has been so low for several years is mainly due to structural changes in our economy. Globalisation, especially China’s entry into world trade, has increased the global labour supply, while reducing employees’ bargaining

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ECB appoints Claudia Plattner as Director General Information Systems

11 days ago

PRESS RELEASE8 January 2021Claudia Plattner has been appointed Director General Information Systems as of 1 July 2021The Executive Board of the European Central Bank (ECB) has appointed Claudia Plattner, currently Chief Information Officer at DB Systel, the IT provider of Deutsche Bahn, to the position of Director General Information Systems as of 1 July 2021. In her current role at DB Systel, Ms Plattner manages the unit that has been responsible for digitalising and modernising the internal IT system of Deutsche Bahn. Prior to that she held several positions, including various managerial roles, at PPA GmbH, a private company dealing with financial data analysis and benchmarks. Ms Plattner holds Master’s degrees in Applied Mathematics from Tulane University in the United States and in

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Isabel Schnabel: Q&A on Twitter

December 18, 2020

INTERVIEWInterview on Twitter with Isabel Schnabel, Member of the Executive Board of the ECB, conducted and published on 17 December 202018 December 2020Good afternoon, this is @Isabel_Schnabel, Executive Board member @ecb. I’m looking forward to answer your questions for the next 45 minutes or so. Join the conversation! #AskECB#AskECB Could you please summarise for someone without a formal education in economics: What functions does the ECB perform? How does the ECB affect the EU economy? What are the underlying economic principles that guide the ECB on its decisions?Schnabel: The @ecb aims to avoid prices rising too fast or too slow so that consumers can rely on stable prices. In doing so, it helps the economy to recover from downturns & avoids the economy running hot. Decisions are

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ECB nominates Frank Elderson as Vice-Chair of the Supervisory Board

December 18, 2020

PRESS RELEASE18 December 2020Governing Council submits proposal to European Parliament for new Vice-Chair of ECB’s Supervisory Board EU Council to give final approval after parliamentary voteThe Governing Council of the European Central Bank (ECB) today has proposed the appointment of ECB Executive Board member Frank Elderson as Vice-Chair of the ECB’s Supervisory Board.The ECB has informed the Chair of the European Parliament’s Committee on Economic and Monetary Affairs (ECON), Irene Tinagli, in line with the Interinstitutional Agreement between the ECB and the European Parliament. The ECB has also informed the President of the Economic and Financial Affairs Council, Olaf Scholz, the German Minister of Finance. Mr Elderson will appear before the ECON Committee at a hearing on a date to be

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Fabio Panetta: Keeping cyber risk at bay: our individual and joint responsibility

December 16, 2020

SPEECHIntroductory remarks by Fabio Panetta, Member of the Executive Board of the ECB, at the fifth meeting of the Euro Cyber Resilience Board for pan-European Financial InfrastructuresFrankfurt am Main, 16 December 2020At the last meeting of the Euro Cyber Resilience Board for pan-European Financial Infrastructures (ECRB), we were all in the same room at the ECB premises in Frankfurt am Main. That was on 27 February 2020, when we launched the Cyber Information and Intelligence Sharing Initiative (CIISI-EU)[1]. We already knew this was a critical step in addressing cyber threats. But we did not know just how timely it was. Shortly after that meeting, the first wave of the coronavirus (COVID-19) pandemic led to strict containment measures across Europe. While the upcoming vaccine roll-outs

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Isabel Schnabel: The importance of trust for the ECB’s monetary policy

December 16, 2020

SPEECHSpeech by Isabel Schnabel, Member of the Executive Board of the ECB, as part of the seminar series “Havarie Europa. Zur Pathogenese europäischer Gegenwarten” at the Hamburg Institute for Social Research (Hamburger Institut für Sozialforschung)Frankfurt am Main, 16 December 2020Ladies and gentlemen,Thank you for inviting me to join this seminar series. I am pleased to speak to you today about Europe and about the euro. The seminar series “Havarie Europa”, literally translated as “shipwreck Europe”, touches on a topic that all proponents of European integration are forced to deal with time and again: euro-scepticism.Public trust in the European Union (EU) and European institutions like the European Central Bank (ECB) has suffered considerable strain in recent years due to the global

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Isabel Schnabel: Welcome address

December 14, 2020

SPEECHWelcome address by Isabel Schnabel, Member of the Executive Board of the ECB, at the third roundtable on euro risk-free ratesFrankfurt am Main, 14 December 2020Good afternoon and welcome to the third roundtable of the industry working group on euro risk-free rates.This year has brought unprecedented challenges on many fronts. Not least, it has forced us to transition to virtual modes of working. I very much hope that the public health situation will soon allow us to meet again in person.Despite the challenging circumstances, I am happy to see that so many of you have joined today’s virtual event, representing the full range of stakeholders from the private financial and non-financial sectors as well as the public sector.The working group was established in 2017 to proactively address

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Fabio Panetta: A commitment to the recovery

December 14, 2020

SPEECH Speech by Fabio Panetta, Member of the Executive Board of the ECB, at the Rome Investment Forum 2020Rome, 14 December 20202020 has been a year like no other. We have faced an economic contraction without precedent in peacetime: in the first half of this year output in the euro area declined by more than 15%. But we have also seen a collective response that has no precedent in the history of our monetary union. That response has protected our economy from a potentially catastrophic depression. And now, with positive news on vaccines, we are finally able to glimpse the light at the end of the tunnel. But we still need to pass through the tunnel. 2021 will likely be a “pandemic year”, characterised by high uncertainty and widespread vulnerabilities among firms and households. How the

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Decisions taken by the Governing Council of the ECB (in addition to decisions setting interest rates)

December 11, 2020

December 202011 December 2020Monetary policyRecalibration of monetary policy instrumentsOn 10 December 2020 the Governing Council decided on recalibrating the ECB’s monetary policy instruments to contribute to preserving favourable financing conditions over the pandemic period, thereby supporting the flow of credit to all sectors of the economy, underpinning economic activity and safeguarding medium-term price stability. More detailed information on decisions can be found in the related press releases available on the ECB’s website.Market operationsEnhancement of communication framework for euro liquidity linesOn 3 December 2020 the Governing Council approved an enhanced communication framework for euro liquidity lines provided by the Eurosystem. The existing general information on euro

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Christine Lagarde, Luis de Guindos: Introductory statement to the press conference (with Q&A)

December 10, 2020

INTRODUCTORY STATEMENTChristine Lagarde, President of the ECB,Luis de Guindos, Vice-President of the ECBFrankfurt am Main, 10 December 2020Jump to the transcript of the questions and answersLadies and gentlemen, the Vice-President and I are very pleased to welcome you to our press conference. We will now report on the outcome of today’s meeting of the Governing Council, which was also attended by the Commission Executive Vice-President, Mr Dombrovskis.While the rebound of economic activity in the third quarter was stronger than expected and the prospects for the roll-out of vaccines are encouraging, the pandemic continues to pose serious risks to public health and to the euro area and global economies. The resurgence in COVID-19 cases and the associated containment measures are

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ECB prolongs support via targeted lending operations for banks that lend to the real economy

December 10, 2020

PRESS RELEASE10 December 2020Extension by an additional 12 months, to June 2022, of period of favourable interest rates for banks that lend to the real economyThree additional three-year operations in June, September and December 2021Borrowing allowance raised to 55% of eligible loans The Governing Council of the European Central Bank (ECB) today decided on modifications to the terms and conditions of the third series of targeted longer-term refinancing operations (TLTRO III). The extension of the pandemic-related low interest rate period, the addition of three more operations and the increase in the amount that can potentially be borrowed under TLTRO III will preserve the very attractive funding conditions that over the past few months have supported banks’ efforts to keep credit flowing

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Monetary policy decisions

December 10, 2020

PRESS RELEASE10 December 2020In view of the economic fallout from the resurgence of the pandemic, today the Governing Council recalibrated its monetary policy instruments as follows: First, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00 per cent, 0.25 per cent and -0.50 per cent respectively. The Governing Council expects the key ECB interest rates to remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2 per cent within its projection horizon, and such convergence has been consistently reflected in underlying inflation dynamics.Second, the Governing Council decided to increase the

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ECB extends pandemic emergency longer-term refinancing operations

December 10, 2020

PRESS RELEASE10 December 2020ECB to offer four additional pandemic emergency longer-term refinancing operations in 2021 allotted on a quarterly basis, each with a tenor of one year.Additional operations provide liquidity backstop to preserve the smooth functioning of the money market during the extended pandemic period.The Governing Council of the European Central Bank (ECB) today decided to offer four additional pandemic emergency longer-term refinancing operations (PELTROs) on a quarterly basis during 2021. Each operation will have a tenor of approximately one year. These operations will serve as a liquidity backstop to the euro area banking system and contribute to preserving the smooth functioning of money markets during the extended pandemic period.The PELTROs will be conducted as

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Denmark to join Eurosystem’s TARGET services

December 8, 2020

PRESS RELEASE8 December 2020Danmarks Nationalbank applies to join additional Eurosystem TARGET services by 2025 Danish krone to become available for settlement in T2 and TIPS payment systems Danmarks Nationalbank, Denmark’s central bank, has applied to join the European Central Bank’s (ECB) T2 payment system, the Eurosystem’s new real-time gross settlement system (RTGS). T2 would then include the Danish krone by November 2025. Danmarks Nationalbank has also expressed interest in joining TARGET Instant Payment Settlement (TIPS) within the same time frame.The inclusion of the Danish krone in the Eurosystem’s payment platforms will enable market participants in Denmark to use T2 and TIPS services and to settle payments in both euro and Danish krone.T2 and TIPS services support transactions

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Philip R. Lane: Transcript of the fireside chat at Reuters Global Outlook Investment Summit

December 2, 2020

INTERVIEWInterview with Philip R. Lane, Member of the Executive Board of the ECB, conducted by Balázs Korányi on 1 December 20202 December 2020The pandemic has of course dominated your year but after nine difficult months, might we be turning a corner? An effective vaccine puts the end of the pandemic in sight. But it’s going to take some time to deploy this vaccine, so 2021 is still going to be difficult. From your perspective, what’s the biggest challenge, the biggest risk in 2021?As you indicate, what we have right now is a mixed story, which is the very good news that we have a credible route towards vaccination. That was, by the way, always the assumption in our baseline forecast, that there would be a medical solution rolled out in 2021. So, from our point of view, the fact that it

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Gradual change seen in euro area payment behaviour

December 2, 2020

PRESS RELEASE2 December 2020Cash most popular instrument for in-person retail payments, but use gradually decliningCard payments becoming increasingly contactlessSurvey suggests coronavirus pandemic has accelerated use of cashless payment methodsEuro area consumers are gradually shifting towards cards for in-person retail payments, although cash remained the most used instrument at the end of 2019, data published today by the European Central Bank (ECB) show.Last year euro area adult consumers used cash for 73% of their point-of-sale and person-to-person retail transactions (48% in value terms). In a previous ECB study conducted in 2016, the figure was 79% of these transactions (54% in value terms). The use of cards for in-person retail payments increased by 5 percentage points over the

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Isabel Schnabel: Interview with Bloomberg

December 1, 2020

INTERVIEWInterview with Isabel Schnabel, Member of the Executive Board of the ECB, conducted by Jana Randow, Carolynn Look and Alexander Weber on 30 November 20201 December 2020ECB staff are currently working on new projections. From today’s perspective, what do you expect them to show, and how much of an impact will the vaccine have on the economic outlook?At the moment we’re seeing two countervailing forces. On the one hand, there are rising infection numbers and renewed lockdowns. This has tilted our outlook to the downside. On the other hand, there’s positive news on the vaccine. This shows that there is light at the end of the tunnel. But of course, we still have to get through the tunnel, so that’s the challenge we’re facing. If we look at the data, we have seen a surprisingly strong

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Christine Lagarde: The future of money – innovating while retaining trust

November 30, 2020

INTERVIEWArticle by Christine Lagarde, President of the ECB, in L’ENA hors les murs magazineParis, 30 November 2020Important lessons can be drawn from the past to understand the factors influencing the journey towards the future of money, including the possible introduction of a digital euro. Ensuring the euro meets the needs of European citizens is at the core of the ECB’s mandate.Throughout history, the nature of money has evolved in response to socioeconomic changes. But the functions of money – as a means of exchange, a unit of account and a store of value – have remained the same for centuries. One reason why money first emerged was to overcome the limitations and inefficiencies of bartering. As economies became more specialised, trade became all the more essential, and a universal

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Yves Mersch: Interview with Le Monde

November 28, 2020

INTERVIEWInterview with Yves Mersch, Member of the Executive Board of the ECB, conducted by Marie Charrel and Eric Albert28 November 2020How do you feel about the euro today compared with your hopes and expectations at the time of negotiating the Maastricht Treaty?At the time, it was a leap into the unknown. The international financial markets were sceptical. And we didn’t know whether citizens would embrace the new currency. Today, I am very satisfied with the outcome. First of all, the euro has won the wholehearted approval of more than 75% of Europe’s citizens. And even the most eurosceptic of political parties have changed their opinion on this given that Europe’s citizens do not want to “undo” what has already been accomplished.What’s more, it’s a currency valued by the corporate

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Luis de Guindos: Interview with Helsingin Sanomat

November 28, 2020

INTERVIEWInterview with Luis de Guindos, Vice-President of the ECB, conducted by Petri Sajari on 24 November 202028 November 2020What are the key risks for the euro area recovery at the moment?The fourth quarter of 2020 will be marked by the measures taken by euro area governments to deal with the new wave of coronavirus (COVID-19) infections that started after the summer. While these containment measures are generally not on the same scale as those taken in March or April, they will have an impact on the economy. We had a welcome surprise in the third quarter, but our quarter-on-quarter growth projection for the fourth, which was slightly above 3%, will not be met. Looking at leading indicators such as the purchasing managers’ index, negative quarter-on-quarter growth is now the most

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Fabio Panetta: Interview with Expresso

November 27, 2020

INTERVIEWInterview with Fabio Panetta, Member of the Executive Board of the ECB, conducted by João Silvestre on 19 November 202027 November 2020There is a great deal of anticipation on the markets and in general looking ahead to the ECB’s December meeting. What can we expect from it?We should expect what the President stated very clearly at the last press conference: that the ECB’s Governing Council will reassess the macroeconomic outlook and recalibrate its measures accordingly. The outlook for inflation has clearly deteriorated rather than improved over the past few months owing to the resurgence of the pandemic and the containment measures taken in response. It’s also clear that our stimulus so far has not been sufficient to make progress towards our aim in a sustained way. In spring we

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Fabio Panetta: From the payments revolution to the reinvention of money

November 27, 2020

SPEECH Speech by Fabio Panetta, Member of the Executive Board of the ECB, at the Deutsche Bundesbank conference on the “Future of Payments in Europe”Frankfurt am Main, 27 November 2020Retail payments play a fundamental role in our daily lives and for the economy. Last year, adults in the euro area made two payments per day on average.[1] The universe of retail transactions[2] amounted to 213 billion payments – two million every five minutes – with an estimated total value of €164 trillion.[3]As part of its mission to promote the smooth operation of the payment system, the Eurosystem has two main objectives in the area of retail payments. The first is to guarantee that people have access to efficient payment solutions that meet their preferences. The second is to ensure that transactions

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Meeting of 28-29 October 2020

November 26, 2020

Account of the monetary policy meeting of the Governing Council of the European Central Bank held in Frankfurt am Main on Wednesday and Thursday, 28-29 October 20201. Review of financial, economic and monetary developments and policy optionsFinancial market developmentsMs Schnabel reviewed the financial market developments since the Governing Council’s previous monetary policy meeting on 9-10 September 2020.Financial markets had been driven by two opposing forces. On one side, reduced risks of a contested presidential election in the United States and expectations of a large fiscal stimulus programme under a potential Biden presidency had boosted risk sentiment and revived the reflation trade. On the other side, renewed lockdown measures in different countries on the back of a surge in new

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Philip R. Lane: Monetary policy in a pandemic: ensuring favourable financing conditions

November 26, 2020

SPEECHSpeech by Philip R. Lane, Member of the Executive Board of the ECB, at the Economics Department and IM-TCD, Trinity College Dublin26 November 2020IntroductionMy aim in this speech today is to explain the role of monetary policy in the pandemic, with a natural focus on the ECB and the euro area. [1],[2] I will first review the monetary policy measures that we have taken in response to the pandemic before highlighting some of the current economic and financial challenges that confront the euro area. I will then explain why the current priority for monetary policy is to ensure favourable financing conditions to support the economic recovery and counteract the negative impact of the pandemic on the projected inflation path.The ECB’s monetary policy measures in 2020: a recapThe scale and

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ECB review sees increased medium-term vulnerabilities for corporates and banks

November 25, 2020

PRESS RELEASE25 November 2020Dispersed economic and financial market impact on countries and sectors could lead to concentration of risks in some areasPolicy measures have addressed liquidity challenges but risks can arise from premature or delayed withdrawal of fiscal support Bank profitability prospects remain weak with losses potentially materialising with a lag relative to the recoveryVulnerabilities in the corporate sector are increasing as the pandemic evolves and their unearthing could test the resilience of euro area banks in the future, the European Central Bank (ECB) says in its latest Financial Stability Review (FSR). Current extensive policy support is helping euro area corporates and households to cope with the fallout of the pandemic, but risks can arise either from a

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Yves Mersch: Interview with Financial Times

November 25, 2020

INTERVIEWInterview with Yves Mersch, Member of the Executive Board of the ECB and Vice-Chair of the Supervisory Board of the ECB, conducted by Martin Arnold on 23 November 202025 November 2020How much does the second wave of coronavirus infections and lockdowns darken the eurozone economic outlook?Governments have learned very rapidly with this pandemic and the recent set of lockdown measures have been much less growth-damaging and much more targeted so the fallout might be mitigated. We also have an extension of the support measures that have been very helpful with the first lockdown and the fiscal response also has to be factored in. What we can see right now is that there is an increase in fragmentation, insofar as we have a divergence between the services sector and the manufacturing

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