Select Language

Portfolio

Share your portfolio and performance in real time
Events & contests

Events and contests held by retail brokers around the world

ECB's Kazaks says "very much open" to discussing a September rate cut

World FX news

Home

Breaking news

ECB's Kazaks says "very much open" to discussing a September rate cut

2024.08.23 08:53

2024.08.23 08:53

European Central Bank (ECB) Governing Council member Martins Kazaks said on Thursday that he's ready to discuss another interest rate cut at the September meeting, voicing confidence in inflation returning to 2% as well as worries over the economy, per Bloomberg.

Key quotes

Given the data we have at the moment, I would be very much open for a discussion of yet another rate cut in September.

A gradual approach to rate cuts would be best.

Cuts are possible even if inflation goes sideways.

Service inflation has been stubborn.

The bank is still on the path to the 2% inflation target next year.

Market reaction

At the time of press, the EUR/USD pair was up 0.04% on the day at 1.1116.

ECB FAQs

What is the ECB and how does it influence the Euro?

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

What is Quantitative Easing (QE) and how does it affect the Euro?

In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets - usually government or corporate bonds - from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.

What is Quantitative tightening (QT) and how does it affect the Euro?

Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.

Created

: 2024.08.23

Last updated

: 2024.08.23

US Dollar rises as sellers take a breather, political jitters
2024.09.21 03:19
Mexican Peso extends losing streak amid risk aversion
2024.09.21 02:57
Fed's Bowman: Would have liked a smaller first cut
2024.09.21 02:34
Fed's Waller: 50 bps cut was the right move
2024.09.21 02:26
EUR/GBP Price Analysis: Sellers hit the gas and take further ground
2024.09.21 00:56
GBP/USD Price Forecast: Gains modestly after hitting record high above 1.3300
2024.09.21 00:24

Writer

FXStreet

Financial media

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?

Yes

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.

Send

Thank you for your feedback.

Japan's National CPI climbs 2.8% YoY in July, Core CPI rises as expected

BoJ's Ueda: July rate increase aligns with the Bank of Japan's economic expectations

Most viewed

USD/CAD consolidates below 1.3600 as investors look for fresh Fed interest rate cues

The USD/CAD pair trades sideways below the crucial resistance of 1.3600 in Friday's North American session.

New

2024.09.20 22:45

Disclaimer:

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree