10 Oct 2013
ECB Monthly Report reiterates forward guidance on rates
FXstreet.com (Barcelona) - In the October ECB Monthly Report the Governing Council reiterated the forward guidance that rates will remain at the current low or lower levels for an extended period of time in order to support the gradual recovery in the Eurozone economic activity.
The ECB reminded that after six consecutive quarters of negative growth in the area, an increase of 0.3% was recorded in the second quarter of 2013. It suggests that output should “recover at a slow pace, in particular owing to a gradual improvement in domestic demand supported by the accommodative monetary policy stance.” A stronger external demand for exports is also expected to boost growth.
Nevertheless, the report lists several factors which could still hurt the recovery such as the continuing geopolitical tensions around the world, elevated commodity prices, a potential slowdown in global demand or a failure of EU national governments to carry out structural reforms on time.
Furthermore, the report contains an analysis of recent commodity price developments and their implications for the ECB's monetary policy as well as an explanation of the role of reference interest rates such as the EURIBOR.
The ECB reminded that after six consecutive quarters of negative growth in the area, an increase of 0.3% was recorded in the second quarter of 2013. It suggests that output should “recover at a slow pace, in particular owing to a gradual improvement in domestic demand supported by the accommodative monetary policy stance.” A stronger external demand for exports is also expected to boost growth.
Nevertheless, the report lists several factors which could still hurt the recovery such as the continuing geopolitical tensions around the world, elevated commodity prices, a potential slowdown in global demand or a failure of EU national governments to carry out structural reforms on time.
Furthermore, the report contains an analysis of recent commodity price developments and their implications for the ECB's monetary policy as well as an explanation of the role of reference interest rates such as the EURIBOR.