Central Banks
ECB Is About to Narrow the Spread Between Its Rates — Here’s Why
- Decision this week will tidy up legacy of crisis-era measures
- Narrowing rates aims to keep control of financing conditions
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The European Central Bank’s likely decision this week to deliver a second reduction in borrowing costs will come with a rather technical twist this time round.
While officials are widely expected to cut their key deposit rate on Thursday by a quarter-point — a standard size used by global peers to adjust policy — two other rates that put a price on the money banks can get from the Frankfurt-based institution will fall by a much less conventional 60 basis points.