REUTERS/Kai Pfaffenbach
Mario Draghi President of the European Central Bank (
The ECB is expected to leave the benchmark euro area refinancing rate unchanged at 0.25% after a surprise reduction from 0.50% following the central bank's November governing council meeting.
Following the release of the statement, ECB president Mario Draghi will hold his monthly press conference and Q&A with reporters beginning at 8:30 AM.
"In the euro area, where the policy rate is close to the zero bound, the reaction function of the ECB has become increasingly difficult to calibrate," says Morgan Stanley economist Elga Bartsch. "On balance, we expect the ECB to lower the refi rate by 15bp in 1Q to just 10bp but leave the depo rate unchanged. But we see an almost 50-50 chance that the ECB will also push the depo rate below zero. It is clear from the press conference that such a step was debated at the November meeting. Eventually, the Governing Council decided against such an unprecedented step though - most likely in recognition of the unintended consequences and potential unanticipated effects that a negative rate could have."
We will have the full statement LIVE at 7:45 and continuing updates during the press conference at 8:30. Click here to refresh for the latest updates »