European Central Bank meeting —

At its 30 April 2020 meeting, the European Central Bank held its policy rate at -0.50%.

Decision

hold — -0.50% to -0.50%

Key passages

the Governing Council decided to reduce the interest rate on TLTRO III operations during the period from June 2020 to June 2021 to 50 basis points below the average interest rate on the Eurosystem’s main refinancing operations prevailing over the same period. Moreover, for counterparties whose eligible net lending reaches the lending performance threshold, the interest rate over the period from June 2020 to June 2021 will now be 50 basis points below the average deposit facility rate prevailing over the same period.

Substantial further easing of TLTRO III terms; effective rate can go as low as -1% for banks meeting lending thresholds.

A new series of non-targeted pandemic emergency longer-term refinancing operations (PELTROs) will be conducted to support liquidity conditions in the euro area financial system and contribute to preserving the smooth functioning of money markets by providing an effective liquidity backstop. They will be carried out as fixed rate tender procedures with full allotment, with an interest rate that is 25 basis points below the average rate on the main refinancing operations prevailing over the life of each PELTRO.

New liquidity backstop at negative rates reinforces accommodative stance.

Meeting documents

Background reading

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