The European Central Bank has confirmed economists’ expectations by keeping its monetary policy stance unchanged. But a rise in inflation and growing dissatisfaction with the ECB’s unprecedented stimulus program in Germany will only increase the pressure on the central bankers to change course at their next meeting on April 27.
Irked by multiple extensions to the ECB’s generous bond-buying program and the effects of its rock-bottom interest rates on banks, insurers and savers, German economists and politicians have stepped forward in the past few weeks to call for adjustments.
European central bankers have so far been undeterred by the Germany-led complaints and, in a widely-expected move Thursday, decided to keep the ECB’s rate main refinancing rate at a record low of 0 percent. Their separate rate on overnight bank deposits, which has become the ECB’s primary interest rate tool in the past couple years as a means of forcing banks to lend out their reserve cash, was also kept unchanged in negative territory at -0.40 percent.
The ECB also withheld any changes to its controversial asset-buying program, vowing to maintain stimulus policy at least until the end of the year.